AMENDED AND RESTATED CHANGE OF CONTROL SEVERANCE AGREEMENT Exhibit 10.2

 

 

 

 

EX-10.1 3 exhibit101.htm EXHIBIT 10.1 (THOMAS MILLNER EMPLOYMENT AGREEMENT)


 

Exhibit 10.1

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

This EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”) is entered into this 13th day of March, 2009 (the “Effective Date”) by and between Cabela’s Incorporated, a Delaware Corporation (“Company”), and Thomas L. Millner (“Executive”).

 

R E C I T A L S

 

WHEREAS, Company is a leading specialty retailer and direct marketer of hunting, fishing, camping and related outdoor merchandise (the “Business”);

 

WHEREAS, Executive is experienced in, and knowledgeable concerning, the Business; and

 

WHEREAS, Company desires to employ Executive in the capacities and on the terms and conditions set forth below, and Executive desires to accept such employment.

 

NOW, THEREFORE, Company and Executive, in consideration of the mutual promises and covenants set forth below, hereby agree as follows:

 

1.           Title and Duties.  Company hereby hires Executive as its President and Chief Executive Officer (“CEO”), effective as of the Commencement Date specified in Section 9 below.  Executive’s principal employment duties and responsibilities shall be those duties typically and historically performed by the President and CEO and as designated from time to time by Company’s Board of Directors (“Board”).  Executive shall be a director of Company and shall report directly to the Board.  At the request of the Board, Executive further agrees to serve without additional compensation as an officer, director or both of any subsidiary or affiliate of Company.  Executive shall discharge his duties as an executive and director, and his duties as a member of any committee of the Board, in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner he reasonably believes to be in the best interests of Company.  Company and Executive shall enter into an Indemnification Agreement contemporaneous with this Agreement.

 

2.           Full-Time Efforts.  Except for illnesses and leave periods, Executive shall devote his full business time, attention and best efforts to the performance of his business duties and responsibilities under this Agreement.  Executive will not engage in any other business or render any commercial or professional services, directly or indirectly, to any other person or organization, whether for compensation or otherwise, unless explicitly approved in writing by Company.  Notwithstanding the foregoing, Executive (i) may make any passive investment where he is not obligated or required to, and shall not in fact, devote any day-to-day managerial efforts, (ii) may participate in charitable, academic, political or community activities and boards, and in trade or professional organizations; and (iii) may hold directorships in other companies consistent with Company’s Corporate Governance Guidelines.

 

 

 

 


 

 

3.           Salary.  Company shall pay Executive an annual base salary of Eight Hundred Thousand and no/100 Dollars ($800,000.00), unless and until adjusted as set forth below (the “Base Salary”).  The Compensation Committee of the Board (“Compensation Committee”) shall review the Base Salary at least annually and, in the absolute discretion of the Compensation Committee, may increase (but not decrease) such Base Salary from time to time based upon the performance of Executive, the financial condition of Company, prevailing industry salary levels and such other factors as the Compensation Committee shall consider relevant.  Executive’s Base Salary shall be paid, less applicable withholdings, in accordance with Company’s regular payroll practices and policies.

 

4.           Incentive Compensation.  Executive shall be eligible to receive an annual performance bonus, less applicable withholdings.  The structure and terms of Company’s bonus policies remain subject to review and revision as determined reasonable or necessary by the Compensation Committee from time to time.   For calendar year 2009, Executive’s target performance bonus will be 100% of Executive’s Base Salary, with a maximum performance bonus award allowed of 160% of Executive’s Base Salary.  Executive’s performance targets will be communicated to Executive within seven (7) days of the Commencement Date, as defined in Section 9 below.  For calendar year 2009, Executive’s performance bonus shall be pro-rated for the period from March 31, 2009 through December 31, 2009. If applicable, Executive’s performance targets and bonus levels for subsequent years shall be reviewed annually and communicated to Executive by the Compensation Committee within Ninety (90) days of the beginning of each calendar year. Executive’s performance bonus, if any, shall be paid, less applicable withholdings, in accordance with Company’s regular payroll practices and policies, but no later than March 15 of the year immediately following the year in which the performance bonus was earned. Notwithstanding the above, performance bonuses, if any, will be paid to Executive only if Executive is actively employed at the time any such bonuses are actually paid.

 

5.           Equity Awards.

 

a.           Participation in Company Equity Plans.  In addition to the compensation in Sections 3 and 4 above, Executive shall be entitled to participate in equity award programs on a basis consistent with that of other senior level executives of Company, as determined by the Compensation Committee in its sole discretion.  Equity awards shall be determined annually by the by the Compensation Committee in its sole discretion.

 

b.           Inducement RSU Award.  On the Effective Date, as consideration for Executive’s execution of and compliance with this Agreement and the related policies and agreements referred to herein, Executive shall be awarded 92,166 Inducement Restricted Stock Units (“Inducement RSUs”).  The Inducement RSUs shall vest in three equal annual installments on the first, second and third anniversary of the Effective Date, subject to Executive’s continued employment with the Company through each such vesting date (except as otherwise provided in Section 10.b.ii below).  The Inducement RSUs will be subject to the terms and conditions of a Restricted Stock Unit Agreement and Proprietary Matters Agreement in the forms provided by Company, which Executive is required to sign, and, although not granted under the Cabela’s Incorporated 2004 Stock Plan (as amended and restated from time to time) (the “2004 Stock Plan”), subject to the terms and conditions of the 2004 Stock Plan as if the Inducement RSUs were granted pursuant to the 2004 Stock Plan.

 

 

 

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c.           Annual Award.   On the Effective Date, as consideration for Executive’s execution of and compliance with this Agreement and the related policies and agreements referred to herein, Executive shall be awarded, in addition to the Inducement RSUs, an initial annual award consisting of 46,083 Initial Annual Restricted Stock Units (“Initial Annual RSUs”) and 111,720 Initial Annual Non-Qualified Stock Options (“Initial Annual NQOs”).  The Initial Annual RSUs shall vest in three equal annual installments on the first, second and third anniversary of the Effective Date, subject to Executive’s continued employment with the Company through each such vesting date.  The Initial Annual NQOs shall vest in three equal annual installments on the first, second and third anniversary of the Effective Date, subject to Executive’s continued employment with the Company through each such vesting date (except as provided in Section 10.b.ii), and expire on the eighth anniversary of the Effective Date.  The Initial Annual RSUs and Initial Annual NQOs will be subject to the terms and conditions of a Restricted Stock Unit Agreement and a Stock Option Agreement, respectively, and Proprietary Matters Agreement in the forms provided by Company, which Executive is required to sign, and, although not granted under the 2004 Stock Plan, subject to the terms and conditions of the 2004 Stock Plan as if the Annual RSUs and Annual NQOs were granted pursuant to the 2004 Stock Plan.

 

d.           NYSE Inducement Award Exception.  The Inducement RSUs, Initial Annual RSUs and Initial Annual NQOs are being granted to Executive as a material inducement to his accepting employment with the Company and shall be granted pursuant to the employment inducement award exception provided by Section 303A.08 of the New York Stock Exchange Listed Company Manual.

 

6.           Moving Expenses.  Subject to the terms of Company’s Employee Relocation Policy, including the Relocation Payback Agreement, Company shall reimburse Executive for up to One Hundred Thousand and No/100 Dollars ($100,000.00) for reasonable moving expenses incurred to relocate to Sidney, Nebraska using NEI Global.  Executive shall also be reimbursed for the costs of up to six (6) months of temporary housing.  Executive shall have up to twelve (12) months from the Commencement Date, as defined in Section 9 below, to utilize Company’s relocation services hereunder.  During this same twelve (12) month period, and subject to the terms of Company’s Executive Travel and Expense Policy, Executive shall be reimbursed up to Twenty-Five Thousand and No/100 Dollars ($25,000.00) for personal travel expenses for Executive and his spouse for travel between High Point, North Carolina, and Sidney, Nebraska.  Executive shall also be reimbursed up to Fifteen Thousand and no/100 Dollars ($15,000.00) for legal expenses incurred by Executive, which are directly related to Executive’s transition of employment to Company.  The parties agree that all travel and legal expenses reimbursed hereunder shall also be subject to reimbursement on the same terms and pursuant to the same schedule as provided in the Relocation Payback Agreement. To the extent any expenses reimbursed under this Section 6 are imputed as income to Executive, Company will pay to Executive such additional amount as necessary to ensure such expense reimbursements  have no federal, state or local tax effect on Executive.

 

7.           Employee Benefits.  During Executive’s employment with Company, Executive shall be eligible to participate in any employee benefit plans and programs as in effect from time to time and generally made available to similarly situated executive employees of Company, in a manner consistent with the terms and conditions of such plan or program, and on a basis that is commensurate with Executive’s then-current positions and duties with Company.  Pursuant to the terms of Company’s Vacations Policy, Executive shall be advanced twenty (20) business days of vacation leave on the Commencement Date, as defined below, which shall be earned on a pro-rated basis throughout Executive’s first employment year.

 

 

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8.           Expenses.  During Executive’s employment with Company, Executive shall be entitled to reimbursement of all reasonable expenses incurred by Executive in connection with the business of Company in accordance with Company’s then-current policies concerning reimbursable expenses as in effect from time to time, including, without limitation, Company’s Executive Travel and Expense Policy, and on a basis no less favorable than that applicable to any other similarly situated executive employees of Company.

 

9.           Term and Termination. This Agreement shall commence on April 6, 2009 (the “Commencement Date”) and shall continue until automatically terminated upon the first to occur of the following (“Effective Date of Termination”):

 

a.           Natural Termination Date.  The third (3rd) anniversary of the Commencement Date of this Agreement (the “Natural Termination Date”).

 

b.           Death or Disability.  The date of Executive’s death or Executive’s physical or mental disability which prevents Executive from performing the essential functions of Executive’s duties as an employee of Company, with or without reasonable accommodation as defined by the Americans with Disabilities Act.

 

c.           Without Cause.  By either party, for any reason, upon thirty (30) days written notice.

 

d.           For Cause.  At the election of Company, and subject to the provisions of this Section 9.d, Executive may be terminated for Cause.  For purposes of this Agreement, “Cause” for termination shall be deemed to exist in the event of:

 

i.           the conviction of Executive of, or the entry of a plea of guilty or nolo contendere by Executive to, a felony, or a misdemeanor involving moral turpitude or fraud; or

 

ii.           a material breach of Executive’s duty of loyalty, Executive’s material breach of the terms of this Agreement, or Executive’s material failure or refusal to substantially perform his duties or adhere to Company’s Business Code of Conduct and Ethics, or to follow the lawful directives of Board (provided such directives are consistent with the terms of this Agreement);

 

provided that, no termination for Cause may be effected unless Board shall have provided Executive with written notice of its intent to terminate his employment for Cause, describing the basis therefore in reasonable detail, and an opportunity to address such claimed basis for Cause at a meeting of the Board, and a majority of the Board thereafter concludes to terminate Executive’s employment for Cause on the basis of the allegations contained in such written notice.

 

e.           For Good Reason.  Executive may terminate this Agreement for Good Reason, at his election, upon written notice to Company of his termination for Good Reason.  Good Reason shall mean a material breach by Company of any provision of this Agreement that continues for a period of thirty (30) days after Executive provides written notice to Company of such breach and a reasonable opportunity to cure such breach.

 

 

 

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Upon any notice of termination of this Agreement pursuant to Section 9.c or notice of Board’s intent to terminate under Section 9.d above, Company shall have the right, in its sole and absolute discretion, to immediately relieve Executive of Executive duties hereunder, but to continue paying Executive’s then-current Base Salary through the remainder of the notice period.  If Executive is not relieved of Executive’s regular duties during this notice period, Executive hereby acknowledges and agrees that Executive shall continue to perform Executive’s duties hereunder in a professional and ethical manner and in compliance with the terms herein.

 

10.           Payments Upon Termination of Employment.

 

a.           Base Salary and Benefits.  Upon termination of employment, Company shall pay to Executive his then-current Base Salary, unreimbursed business expenses, and other items earned by and owed to Executive, calculated through and including the Effective Date of Termination.  In the event that Executive’s employment terminates pursuant to Section 9.b above, he shall also be paid an amount equal to the product of (i) his target annual bonus for the year in which such termination occurs and (ii) a fraction, the numerator of which is the number of days during such year up to and including the date of termination and the denominator of which is 365 (the “Pro-Ration Fraction”).  Any target bonus due under this Section 10.a shall be calculated and paid by March 15 of the year following termination in accordance with Company’s regular payroll practices and policies.  Executive’s benefits shall be determined in accordance with Company’s benefit plans or policies then in effect.

 

b.           Severance Benefits.  In the event Executive’s employment is terminated before the Natural Termination Date by Company without Cause pursuant to Section 9.c above or by Executive for Good Reason pursuant to Section 9.e above, and subject to Executive’s execution of a separation agreement and full general release of claims against Company in substantially the same form as attached hereto as Exhibit A within 45 days of the date of Executive’s termination:

 

i.           Severance.  Company shall pay Executive severance compensation equal to the lesser of two (2) year’s Base Salary or the amount of Base Salary Executive would have been entitled to through the Natural Termination Date of this Agreement (the “Severance Compensation”); provided, however, the Severance Compensation shall not be less than one (1) year of Base Salary. The Severance Compensation, less applicable withholdings, shall be paid in equal monthly installments throughout the applicable term (i.e., the lesser of 2 years or the remainder of the natural term of the agreement, but not less than 1 year), with the first monthly installment due on Company’s first regular payday following the effective date of the general release discussed above.

 

ii.           Equity Vesting.  Any unvested stock options, restricted stock units or other equity interests of Company awarded to Executive, either as an inducement award under Section 5.b or 5.c or pursuant to Executive’s participation in the 2004 Stock Plan, shall fully vest on the effective date of the general release discussed above and Executive shall have twelve (12) months from such date to exercise Executive’s vested equity interests.

 

 

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iii.           Pro-Rated Bonus. Executive shall be paid, at the same time as annual bonuses are payable to other senior executives of the Company (but in no event later than March 15 of the calendar year following the calendar year in which Executive’s employment terminated), an amount equal to the product of (i) the annual bonus that would have been payable to him (based on actual achievement of any applicable business performance objectives, but without adjustment for any individual performance) had he continued to be employed through the date of payment times (ii) the Pro-Ration Fraction.

 

11.           Termination of Authority.  Executive acknowledges and agrees that, immediately upon the effective date of termination of Executive’s employment with Company for any reason, notwithstanding anything else appearing in this Agreement or otherwise to the contrary, Executive will cease performing duties for Company.  Executive shall be without any authority to bind Company or any of its subsidiaries or affiliates.  Executive further acknowledges and agrees that, upon termination of employment, he shall immediately resign, and shall be deemed to have immediately resigned, all offices and director positions with Company and its subsidiaries and affiliates.  On request of the Board, Executive shall complete such documents as may be required to formalize such resignations.

 

12.           Confidential and Proprietary Information.  Executive hereby acknowledges that as an employee, officer and director of Company, Executive is and will continue to be subject to policies and agreements intended for the protection of Company’s confidential and proprietary information, trade secrets, and goodwill.  Executive shall not, without the express written consent of the Board, disclose Company’s Confidential Information to any third party or entity, or use Company’s Confidential Information for any other purpose than providing services to Company.  Company’s “Confidential Information” shall mean, without limitation, any information not generally known by third parties, including Company’s competitors or the general public, whether or not expressly identified as confidential, including, without limitation, information about Company’s software, software source codes, trade secrets, intellectual property, marketing information, business plans, mergers and acquisitions, sales information, training materials, data processing, internet or intranet services, strategic plans, compensation, and finances, as well as information about Company’s customers and potential customers, including their identities and their business needs and practices.

 

13.           Change in Control Severance Agreement.  As a condition to Executive’s employment, Executive shall be required to enter into a Management Change of Control Severance Agreement with Company (“Change of Control Agreement”).  The parties expressly agree that if Executive is entitled to Severance Compensation under this Agreement and benefits under the Change of Control Agreement, that such entitlement shall not be cumulative, and Executive will be entitled to the benefits under either this Agreement or the Change of Control Agreement, whichever is greater.

 

14.           Assignment.  This Agreement and the rights, interests and obligations of Company hereunder shall be assignable to and shall inure to the benefit of any parent, subsidiary or affiliate of Company, or any other person, corporation, partnership or entity that succeeds to all or substantially all of the business or assets of Company.  This Agreement is not assignable by Executive.

 

 

 

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15.           Jurisdiction and Venue.  This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Nebraska.  Each party agrees that any action by either party to enforce the terms of this Agreement may be brought by the other party in an appropriate state or federal court in Nebraska and waives all objections based upon lack of jurisdiction or improper or inconvenient venue of any such court.

 

16.           Cooperation in Future Matters.  Executive hereby agrees that for a period of eighteen (18) months following his termination of employment, he shall cooperate with the Company  with respect to any legal proceedings, investigations or audits on behalf of Company pertaining to matters that were under his direct supervision and control during Executive’s employment by Company. Any such cooperation shall be performed at scheduled times taking into consideration Executive’s other commitments, and Executive shall be compensated at a reasonable rate per hour, plus expenses, to the extent such cooperation is required on more than an occasional and limited basis.

 

17.           Remedies.  Executive acknowledges and agrees that the services he provides hereunder are unique and special; and as such, Executive expressly acknowledges that any breach or violation of any of Sections 11 or 12 of this Agreement will cause immediate and irreparable injury to Company.  In the event of a breach or violation of such provisions by Executive, Company, in addition to all other legal and equitable remedies available to it, shall be entitled to injunctive relief to enforce this Agreement.  For purposes of clarification, the terms in Sections 11 and 12 of this Agreement are considered material.  In addition to the above, the parties expressly agree that, in the event of a breach or threatened or intended breach of Sections 11 or 12 of this Agreement by Executive, Company’s payment obligations, if any, under Section 10 of this Agreement shall immediately cease, without relieving Executive of his obligations hereunder.

 

18.           General.

 

a.           Notices.  All notices and other communications hereunder shall be in writing or by written telecommunication, and shall be deemed to have been duly given if delivered personally or if sent by overnight courier or by certified mail, return receipt requested, postage prepaid or sent by written telecommunication or telecopy, to the relevant address set forth below, or to such other address as the recipient of such notice or communication shall have specified in writing to the other party hereto, in accordance with this Section 18.a

 

If to Company, to:            Cabela’s Incorporated

ATTN:  Legal Department

One Cabela Drive

Sidney, Nebraska 69160

(308) 254-8060 (facsimile)

 

If to Executive, at his last residence shown on the records of Company.

 

Any such notice shall be effective (i) if delivered personally, when received, (ii) if sent by overnight courier, when receipted for, (iii) if mailed, five (5) days after being mailed, and (iv) on confirmed receipt if sent by written telecommunication or telecopy, provided a copy of such communication is sent by regular mail, as described above.

 

 

 

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b.           Reformation and Severability.  Executive and Company intend and agree that if a court of competent jurisdiction determines that the scope of any provision of this Agreement is too broad to be enforced as written, the court should reform such provision(s) to such narrower scope as it determines to be enforceable.  Executive and Company further agree that if any provision of this Agreement is determined to be unenforceable for any reason, and such provision cannot be reformed by the court as anticipated above, such provision shall be deemed separate and severable and the unenforceability of any such provision shall not invalidate or render unenforceable any of the remaining provisions hereof.

 

c.           Waivers.  No delay or omission by either party hereto in exercising any right, power or privilege hereunder shall impair such right, power or privileges, nor shall any single or partial exercise of any such right, power or privilege preclude any further exercise thereof or the exercise of any other right, power or privilege.

 

d.           Counterparts.  This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and same instrument.

 

e.           Entire Agreement.  This Agreement, including the initial paragraph and the recitals to this Agreement, each of which are incorporated herein and made part of this Agreement by this reference, contains the entire understanding of the parties, supersedes all prior agreements and understandings, whether written or oral, relating to the subject matter hereof and may not be amended except by a written instrument hereafter signed by Executive and a duly authorized representative of the Company (other than Executive).

 

f.           Survival.  The provisions of Sections 10 through 18 shall survive the termination of this Agreement.

 

[The remainder of this page intentionally left blank; Signature page follows.]

 

 

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IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

CABELA’S INCORPORATED,

a Delaware corporation

 

 

 

 

 

 

 

 

 

 

By:

/s/ Charles Baldwin

 

/s/ Thomas L. Millner

 

Charles Baldwin, Vice President and

Chief Human Resources Officer

 

Thomas L. Millner

 

 

 

 


 

 

Exhibit A

 

SEPARATION AGREEMENT AND GENERAL RELEASE

 

This Separation Agreement and General Release (the “Agreement”) is made and entered into this _____ day of ____________________, _____, by and between Cabela’s Incorporated (“Company”) and ________________________________________ (“Executive”).

 

RECITALS

 

WHEREAS, Executive and Company are parties to that certain Executive Employment Agreement dated ___________________ _____, _____ (“Employment Agreement”).

 

WHEREAS, Executive’s employment with Company has been terminated;

 

WHEREAS, pursuant to the Employment Agreement, Executive is eligible for certain severance benefits, subject to the condition that he execute a separation agreement and general release of Company; and

 

WHEREAS, the parties desire this Agreement to satisfy such condition.

 

NOW THEREFORE, in consideration of promises and covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, agree as follows:

 

1.           Termination of Employment.  Executive’s employment with Company terminated effective ___________________ _____, _____ (the “Termination Date”).  Executive hereby resigns all offices and directorships with Company or any subsidiary or affiliate of Company.  Executive acknowledges and agrees that he is without any authority to bind Company or any of its subsidiaries or affiliates.

 

2.           Final Compensation. Executive shall receive Executive’s final paycheck, less applicable withholdings, on the next regular payday following the Termination Date, in accordance with Company’s regular payroll practices.

 

3.           Benefits.  Executive’s final paycheck will include all accrued, unused vacation time owed to Executive as of the Termination Date.  Executive’s group medical insurance terminates on __________, except Executive shall be eligible to continue Company’s group medical insurance coverage to the extent provided by law, commonly known as COBRA.  All other Executive benefits terminated on the Termination Date, and Executive acknowledges that Executive is not entitled to any additional amounts from Company for wages, bonuses, or benefits, of any kind, except as expressly set forth in this Agreement.  Executive will receive reimbursement for any preapproved business expenses properly submitted in accordance with Company’s Executive Travel and Expense Policy.

 

4.           401(k) Plan. Executive is a participant in the Company’s 401(k) Plan (the “401(k) Plan”). Executive’s vested balance in the 401(k) Plan will be held, paid or rolled over pursuant to the 401(k) Plan provisions.  Contributions to the Company’s 401(k) Plan will not continue following the Termination Date.

 

 

 

 


 

 

5.           Severance.  In consideration of Executive’s execution of this Agreement, Executive shall receive the following:

 

a.           Severance Pay.  Executive shall receive severance pay totaling $____________________ (the “Severance Payments”).  The Severance Payments shall be paid, less applicable withholdings, in _____ equal monthly installments, in accordance with Company’s regular payroll practices, with the first monthly installment paid on Company’s next regular payday following the Effective Date of this Agreement, as defined below.

 

b.           Stock Options.  Executive was a participant in Company’s 2004 Stock Plan, as amended (the “Plan”), and Employee and Company are parties to Stock Option Agreements executed ___________ and ____________.  As of the date of this Agreement, Executive has _________ shares of common stock fully vested under the Plan.  Additionally, Company hereby accelerates any remaining unvested stock options, restricted stock units or other equity interests of Company awarded to Executive, either as an inducement award under Section 5.b or 5.c of the Employment Agreement or pursuant to Executive’s participation in the Plan.  All such equity interests shall fully vest on the Effective Date, as defined below, and Executive shall have twelve (12) months from such date to exercise Executive’s vested equity interests.

 

c.           Pro-Rated Bonus. Executive shall be paid, at the same time as annual bonuses are payable to other senior executives of Company (but in no event later than March 15 of the calendar year following the calendar year in which Executive’s employment terminated), an amount equal to the product of (i) the annual target bonus that would have been payable to Executive (based on actual achievement of any applicable business performance objectives, but without adjustment for any individual performance) had he continued to be employed through the date of payment and (ii) a fraction, the numerator of which is the number of days during such year up to and including the date of termination and the denominator of which is 365.

 

6.           Release.  Executive hereby releases and forever discharges Company, its subsidiaries and affiliates, and their respective current and former shareholders, officers, directors, members, Executives, attorneys, representatives and agents (collectively, the “Released Parties), from any and all claims, damages (including attorney fees), demands, actions or causes of action of any kind or nature, whether known or unknown, whether under contract or tort, that Executive, Executive’s heirs, executors, administrators, successors and assigns have, or may have, arising out of Executive’s employment with Company and/or the termination of Executive’s employment by Company, (collectively the “Claims”) including, but not limited to, any Claims under any contract, agreement, plan, policy or program of Company, and any Claims under any federal, state or local statutory or common laws, including, but not limited to, the Age Discrimination in Employment Act, Older Workers Benefit Protection Act, Title VII of the Civil Rights Act, Americans with Disabilities Act, Fair Labor Standards Act, Family and Medical Leave Act, Executive Retirement Income Security Act, the Nebraska Fair Employment Practice Act, the Nebraska Age Discrimination in Employment Act, and the Nebraska Wage Payment and Collection Act, all as amended.  Executive hereby acknowledges and agrees that Executive is knowingly and voluntarily releasing and waiving all Claims that Executive has or may have against the Released Parties as described above.

 

 

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7.           No Admission.  Executive agrees that neither this Agreement nor any obligations under this Agreement constitute an admission by Company of any violation of any federal, state or local laws, rules or regulations or of any liability under contract or tort theories.  Company specifically disclaims any wrongdoing whatsoever against Executive by any of the Released Parties.

 

8.           Interest.  Executive represents and warrants that Executive has the sole right and exclusive authority to execute this Agreement, and that Executive has not sold, assigned, transferred, conveyed, or otherwise previously disposed of any claim or demand relating to any matter covered by this Agreement.  Executive acknowledges that, as of the date of this Agreement, Executive has not initiated any administrative or legal proceeding of any kind against any of the Released Parties.

 

9.           Confidential Information.  Executive acknowledges that Executive’s employment with Company necessarily involved access to and familiarity with highly sensitive and proprietary information regarding the products, services, intellectual property (including, but not limited to, patents, trademarks, copyrights, mask works, trade secrets, business processes, software and the source code thereof), customers, prospective customers, personnel, vendors, suppliers, pricing and costing information, marketing strategies, business plans, methods, financial information and other related information belonging to Company, its subsidiaries or affiliates (collectively referred to herein as “Confidential Information”).  Executive agrees that the Confidential Information was entrusted to Executive solely for use in Executive’s capacity as an employee, officer and director of Company.  Executive will forever treat all matters relating to Company’s business and the business of Company’s subsidiaries or affiliates as Confidential Information, and Executive agrees not to use, give or divulge such Confidential Information to any third party for any reason, unless required by law.  Executive further acknowledges and agrees that he remains bound by the terms and conditions of the Proprietary Matters Agreement entered into with Company, dated ____________ (the “PMA”), and that he has read and understands the terms and conditions of the PMA, and that such terms and conditions are reasonable.

 

10.           Return of Property.  Executive agrees that Executive has returned, or will return within two business days of the date hereof, to Company all Company property of every kind, including but not limited to, all books, keys, records, computer passwords, lists and other written or printed materials, whether furnished by Company or prepared by Executive.  Executive agrees that Executive will neither make nor retain any copies of such materials after the Termination Date.

 

11.           Nondisparagement.  Executive agrees not to make disparaging, critical or otherwise detrimental comments to any person or entity concerning any of the Released Parties; the products, services or programs provided or to be provided by any of the Released Parties; the business affairs or the financial condition of any of the Released Parties; or the circumstances surrounding Executive’s employment and/or separation of employment from Company.  The previous sentence does not apply to comments made during legal or administrative investigations or proceedings, or otherwise as required by law.

 

 

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12.           Remedies.  Executive expressly acknowledges that any breach or violation of any of the covenants or agreements contained in this Agreement will cause immediate and irreparable injury to Company.  In the event of a breach or threatened or intended breach of this Agreement by Executive, Company, in addition to all other legal and equitable remedies available to it, shall be entitled to withhold any remaining Severance Payments and to injunctive relief to enforce this Agreement.  In addition to the above, the parties expressly agree that, in the event of a breach or threatened or intended breach of this Agreement by Executive, Company’s payment obligations under this Agreement shall immediately cease, without relieving Executive of his obligations hereunder.

 

13.           Review Period.  This Agreement affects the legal rights of the parties.  Executive should consult with an attorney prior to signing this Agreement.  Executive shall be responsible for all legal fees incurred by him relating to this Agreement.  Executive’s signature below acknowledges and confirms that this Agreement is written in a manner that Executive understands, that Executive has read and fully understands this Agreement, and that Executive has signed this Agreement freely and voluntarily.  Executive acknowledges that Executive has been given forty-five (45) days to consider signing this Agreement (the “Review Period”).  Executive may sign this Agreement before the expiration of the first twenty-one days of the Review Period only by also signing and delivering to Company, along with this Agreement, the Waiver attached hereto as Exhibit “A” and incorporated by this reference.

 

14.           Right of Revocation.  Executive acknowledges and understands that Executive may revoke this Agreement for a period of up to seven (7) days after Executive executes it (not counting the day it is signed).  To revoke this Agreement, Executive must give written notice to Company stating that Executive wishes to revoke this Agreement, by providing notice by hand-delivery, mail or facsimile to:

 

_____________________________________

_____________________________________

_____________________________________

_____________________________________

 

This Agreement shall become effective and enforceable on the eighth day following Executive's signing of this Agreement (the “Effective Date”).

 

15.           General.

 

a.           Jurisdiction and Venue.  This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Nebraska.  Each party agrees that any action by either party to enforce the terms of this Agreement may be brought by the other party in an appropriate state or federal court in Nebraska and waives all objections based upon lack of jurisdiction or improper or inconvenient venue of any such court.

 

b.           Assignability.  This Agreement and the rights, interests and obligations of Company hereunder shall be assignable to and shall inure to the benefit of any subsidiary or affiliate of Company or to any person, corporation, partnership or entity that succeeds to all or substantially all of the business or assets of Company.  This Agreement is not assignable by Executive.

 

 

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c.           Entire Agreement.  This Agreement, including the initial paragraph, the recitals to this Agreement, and the Exhibits to this Agreement, each of which is incorporated herein and made part of this Agreement by this reference, constitutes the entire agreement and understanding of the parties relating to all of the subject matter herein, and supersedes all prior agreements, arrangements and understandings, written or oral between the parties concerning such subject matter.  The previous sentence notwithstanding, Executive acknowledges that as an Executive of Company, Executive was subject to other policies and agreements intended for the protection of Company’s Confidential Information, and as such, Executive expressly acknowledges that all such policies and agreements, including without limitation, the PMA, are not superseded herein and shall be used together with this Agreement to protect Company’s interest in its Confidential Information to the fullest extent allowed by law.  This Agreement shall inure to the benefit of and shall be binding upon Executive and Executive’s heirs, executors, personal representatives and legal representatives.  This Agreement may not be modified or supplemented except by a written instrument signed by each of the parties.

 

d.           Survival. Section 15.c above notwithstanding, and for purposes of clarification, the parties expressly agree and acknowledge that promises and obligations contained in the Indemnification Agreement between the parties, dated ___________, the PMA and Sections 11, 12 and 16 of the Employment Agreement, survive the termination of Executive’s employment with Company for any reason.  Nothing in this Agreement or otherwise shall be deemed to terminate or supersede such continuing obligations and the parties agree and acknowledge that they intend to, and shall, remain legally bound by such provisions.

 

e.           Reformation & Severability.  Executive and Company intend and agree that if a court of competent jurisdiction determines that the scope of any provision of this Agreement is too broad to be enforced as written, the court should reform such provision(s) to such narrower scope as it determines to be enforceable.  Executive and Company further agree that if any provision of this Agreement is determined to be unenforceable for any reason and such provision cannot be reformed by the court as anticipated above, such provision shall be deemed separate and severable and the unenforceability of any such provision shall not invalidate or render unenforceable any of the remaining provisions hereof.

 

f.           Confidentiality.  Executive agrees that the terms of this Agreement are confidential and will not be disclosed except where disclosure is required by law or where necessary in a legal action brought to enforce the terms of this Agreement.  Notwithstanding the foregoing, it is agreed that Executive may disclose the terms and amounts of this Agreement to Executive’s attorney, accountant and spouse.

 

g.           Counterparts/Electronic Transmission.  This Agreement may be executed in one or more counterparts, any of which may be executed and transmitted by facsimile or other electronic method, and each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

 

 

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The parties hereto have executed this Separation Agreement and General Release as of the day and year first above written.

 

CABELA’S INCORPORATED

 

 

 

 

 

 

 

 

 

 

By

 

 

 

 

 

 

[Executive]

Its

 

 

 

 

 

 

 

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EXHIBIT “A”

 

WAIVER

 

I, the undersigned, hereby knowingly and voluntarily waive my right to a full twenty-one days to review and consider the Separation Agreement and General Release (“Agreement”) set forth above.  I fully understand and agree that by signing this WAIVER I surrender for all time whatever right(s) and/or claim(s) I may have to challenge the Agreement set forth above because a full twenty-one days did not expire before I signed said Agreement in exchange for expediting implementation of the terms of the Agreement.  I have read, fully understand and consent to the terms of this WAIVER and I sign it in the absence of fraud, duress, undue influence or reliance upon any oral and/or written representations not included in the terms of this WAIVER.

 

 

 

 

 

Dated:

 

 

 

 

 

 

[Executive]

 

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EX-10.2 4 exhibit102.htm EXHIBIT 10.2 (FORM OF 2009 AMENDED AND RESTATED MANAGEMENT CHANGE OF CONTROL SEVERANCE AGREEMENT)


 

Exhibit 10.2

 

AMENDED AND RESTATED

MANAGEMENT CHANGE OF CONTROL SEVERANCE AGREEMENT

 

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”).

 

W I T N E S S E T H :

 

WHEREAS, the Executive is presently an officer or key employee of the Company;

 

WHEREAS, the Executive and the Company are parties to an existing Management Change of Control Severance Agreement (the “Original Agreement”);

 

WHEREAS, the Executive and the Company desire to enter into this Agreement to amend and restate the Original Agreement to eliminate the tax gross-up provisions and make certain clarifying changes to ensure that performance-based compensation is, to the extent intended by the parties, in compliance with Section 162(m) of the Code;

 

WHEREAS, the Company desires to ensure the Executive’s continued active participation in the business of the Company;

 

WHEREAS, in order to induce the Executive to remain in the employ of the Company and in consideration of the Executive’s agreeing to remain in the employ of the Company, the parties desire to specify the severance benefits which shall be due the Executive in the event that his employment with the Company is terminated under specified circumstances; and

WHEREAS, the Company and the Executive intend for this Agreement to amend and restate the Original Agreement in its entirety.

 

NOW THEREFORE, in consideration of the mutual agreements contained in this Agreement, and upon the other terms and conditions provided in this Agreement, the parties to this Agreement agree as follows:

 

1.           Definitions.  The following words and terms shall have the meanings set forth below for the purposes of this Agreement:

 

(a)           Annual Compensation.  The Executive’s “Annual Compensation” for purposes of this Agreement shall be deemed to mean the sum of (i) the base salary paid to the Executive by the Company or any subsidiary thereof during the calendar year in which the Date of Termination occurs (determined on an annualized basis) and (ii) the average of the incentive compensation award granted to the Executive by the Company under the Cabela’s Incorporated Performance Bonus Plan (or any predecessor or successor bonus plan) in each of the two calendar years preceding the calendar year in which the Date of Termination occurs (determined on an annualized basis).

 

(b)           Board.  “Board” shall mean the Board of Directors of the Company.

 

 

 


 

 

(c)           Cause.  Termination of the Executive’s employment for “Cause” shall mean termination because (i) the Executive is charged with a felony, (ii) in the reasonable determination of the Company, the Executive has committed an act of fraud, embezzlement or theft relating to the Company, (iii) in the reasonable determination of the Company, the Executive has committed gross negligence in the course of his employment with the Company that is materially detrimental to the business of the Company, (iv) the Executive fails to fulfill his duties as an employee of the Company, including inattention to or neglect of his duties and shall not have remedied such failure within thirty (30) days after receiving written notice from the Company specifying the details thereof, or (v) of a third occurrence of the same action or inaction which caused the Company to previously give the Executive notice under Section 1(c)(iv).  For purposes of this Agreement, an act or omission on the part of the Executive shall be deemed “gross negligence” only if it was done by the Executive in bad faith, not merely an error in judgment and without reasonable belief that the act or omission was in the best interests of the Company.  In the event the Executive disputes the existence of Cause in connection with a termination of employment, no termination for Cause shall be effective in the absence of an affirmative vote of seventy-five percent (75%) of the members of the entire Board (disregarding any director who must abstain).

 

(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;

 

 

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(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.

 

(e)           COBRA.  “COBRA” shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

 

(f)           Code.  “Code” shall mean the Internal Revenue Code of 1986, as amended.

 

(g)           Date of Termination.  “Date of Termination” shall mean:

 

(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.

 

 

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(h)           Disability.  Termination by the Company of the Executive’s employment based on “Disability” shall mean termination because the Executive  either (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident or health plan covering employees of the Company.

 

(i)           Equity Plans.  “Equity Plans” shall mean all stock option, restricted stock, restricted stock unit and other equity plans of the Company, including the 2004 Stock Plan, the 2004 Employee Stock Purchase Plan and the 1997 Stock Option Plan.

 

(j)           Good Reason.  “Good Reason” shall mean actions taken by the Company resulting in a material negative change in the employment relationship. For these purposes, a “material negative change in the employment relationship” shall include:

 

(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.

 

 

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(k)           Notice of Termination.  Any purported termination of the Executive’s employment by the Company for any reason, including for Cause, Disability or Retirement, or by the Executive for any reason, including for Good Reason, shall be communicated by written “Notice of Termination” to the other party to this Agreement.  For purposes of this Agreement, a “Notice of Termination” shall mean a dated 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 Executive’s employment under the provision so indicated, (iii) if the Date of Termination (as defined herein) is other than the date of receipt of such notice, specifies the Date of Termination (which Date of Termination shall be not more than 30 days after the giving of such notice), and (iv) is given in the manner specified in Section 10.

 

(l)           Retirement.  “Retirement” shall mean any termination of the Executive’s employment with the Company, either voluntarily or involuntarily, by the Executive or the Company after the Executive reaches age sixty-five (65).

 

2.           Benefits Upon Termination.  If the Executive’s employment by the Company is terminated within twenty-four (24) months after a Change in Control by (i) the Company for any reason other than Cause, Disability, Retirement or the Executive’s death or (ii) the Executive for Good Reason, then:

 

(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;

 

 

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(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.

 

3.           Mitigation; Exclusivity of Benefits.

 

(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.

 

4.           Withholding.  All payments required to be made by the Company under this Agreement to the Executive shall be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as the Company may reasonably determine should be withheld pursuant to any applicable law or regulation.

 

5.           Nature of Employment and Obligations.

 

(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.

 

 

 

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(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.

 

6.           Proprietary Information.  The parties agree to the protection of the Company’s proprietary information as follows:

 

(a)           Nondisclosure of Confidential Information.

 

(i)           Access.  The Executive acknowledges that employment with Company necessarily involves exposure to, familiarity with and opportunity to learn highly sensitive, confidential and proprietary information of the Company and its subsidiaries, which may include information about products and services, markets, customers and prospective customers, vendors and suppliers, miscellaneous business relationships, investment products, pricing, billing and collection procedures, proprietary software and other intellectual property, financial and accounting data, personnel and compensation, data processing and communications, technical data, marketing strategies, research and development of new or improved products and services and know-how regarding the business of the Company and its products and services (collectively referred to herein as “Confidential Information”).

 

(ii)           Valuable Asset.  The Executive further acknowledges that the Confidential Information is a valuable, special and unique asset of the Company, such that the unauthorized disclosure or use by persons or entities outside the Company would cause irreparable damage to the business of the Company.  Accordingly, the Executive agrees that during and after the Executive’s employment with the Company, until the Confidential Information becomes publicly known, the Executive shall not directly or indirectly disclose to any person or entity, use for any purpose or permit the exploitation, copying or summarizing of, any Confidential Information of the Company, except as specifically required in the proper performance of his duties for the Company.

 

(iii)           Duties.  The Executive agrees to take all appropriate action, whether by instruction, agreement or otherwise, to ensure the protection, confidentiality and security of the Confidential Information and to satisfy his obligations under this Agreement.  Prior to lecturing or publishing articles which reference the Company and its business, the Executive will provide to an officer of the Company a copy of the material to be presented for the Company to review and approve in order to ensure that no Confidential Information is disclosed.

 

(iv)           Confidential Relationship.  The Company considers its Confidential Information to constitute “trade secrets” which are protected from unauthorized disclosure under applicable law.  However, whether or not the Confidential Information constitutes trade secrets, the Executive acknowledges and agrees that the Confidential Information is protected from unauthorized disclosure or use due to his covenants under this Section 6 and his fiduciary duties as an executive of the Company.

 

 

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(v)           Return of Documents.  The Executive acknowledges and agrees that the Confidential Information is and at all times shall remain the sole and exclusive property of the Company.  Upon the termination of his employment with the Company or upon request by the Company, the Executive will promptly return to the Company in good condition all documents, data and records of any kind, whether in hardcopy or electronic form, which contain any Confidential Information or which were prepared based on Confidential Information, including any and all copies thereof, as well as all materials furnished to or acquired by the Executive during the course of the Executive’s employment with the Company.

 

(b)           Development of Intellectual Property.

 

(i)           Definition of Intellectual Property.  As used in this Agreement, the term “Intellectual Property” shall include any inventions, technological innovations, discoveries, designs, formulas, know-how, processes, patents, trademarks, service marks, copyrights, computer software, ideas, creations, writings and other works of authorship, books, lectures, illustrations, photographs, scientific and mathematical models, improvements to all such property and all recorded material defining, describing or illustrating all such property, whether in hardcopy or electronic form.

 

(ii)           The Company’s Rights in Intellectual Property.  The Executive agrees that all right, title and interest of every kind and nature, whether now known or unknown, in and to any Intellectual Property invented, created, written, developed, conceived or produced by the Executive during the term of the Executive’s employment with the Company (i) whether using the Company’s equipment, supplies, facilities or Confidential Information, (ii) whether alone or jointly with others, and (iii) whether or not during normal working hours, that are within the scope of the Company’s actual or anticipated business operations or that relate to any of the Company’s actual or anticipated products or services shall be the exclusive property of the Company and the Executive hereby assigns to the Company all rights to such Intellectual Property without limitation or royalty.  To the extent that any such Intellectual Property is copyrightable, it shall be deemed to be a “work for hire” within the meaning of the copyright laws.  Consideration for such assignment is hereby acknowledged.  The Executive will promptly and fully disclose to the Company any and all such Intellectual Property.  The Executive agrees that any patent application filed by him within one year after termination of his employment is presumed to relate to an invention developed during the term of the Executive’s employment with the Company and thus is the exclusive property of the Company.  As such, the Executive agrees to disclose to the Company all such patent applications.  The Executive hereby consents and agrees that the Executive shall have no right, title or interest of any kind or nature in or to any item of Intellectual Property, or in or to any results or proceeds from any Intellectual Property.

 

(iii)           Additional Actions.  The Executive agrees to take all reasonably necessary actions to enable the Company to obtain and perfect its rights in the Intellectual Property, including assisting the Company in obtaining patents, copyrights, trademarks, service marks and similar protections in the United States and all foreign countries.  The Executive further agrees to assist the Company in connection with any demands, reissues, oppositions, litigation, controversy or other actions involving any item of Intellectual Property.  The Executive agrees to undertake the foregoing obligations both during and after the Executive’s employment with the Company, without charge, but at the Company’s expense with respect to the Executive’s reasonable out-of-pocket costs.  The Executive further agrees that the Company may, in its sole discretion, keep such Intellectual Property as trade secrets, in which case the Executive will comply with the Confidential Information provisions in Section 6(a) above.

 

 

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(c)           Enforcement.  For purposes of this Section 6, the term “Company” shall include the Company and all of its subsidiaries.  Each of the Company’s subsidiaries shall be an intended third party beneficiary of this Agreement and shall have the right to enforce the provisions of this Agreement against the Executive individually or collectively with any one or more of the other subsidiaries.

 

(d)           Equitable Relief.  The Executive acknowledges and agrees that, by reason of the sensitive nature of the Confidential Information and Intellectual Property of the Company referred to in this Agreement, in addition to recovery of damages and any other legal relief to which the Company may be entitled in the event of the Executive’s violation of this Agreement, the Company shall also be entitled to equitable relief, including such injunctive relief as may be necessary to protect the interests of the Company in such Confidential Information and Intellectual Property and as may be necessary to specifically enforce the Executive’s obligations under this Agreement.

 

7.           Severability.  The Executive and the Company intend and agree that if a court of competent jurisdiction determines that the scope of any provision of this Agreement is too broad to be enforced as written, the court should reform such provisions to such narrower scope as it determines to be enforceable.  The Executive and the Company further agree that, if any provision of this Agreement is determined to be unenforceable for any reason, such provision shall be deemed separate and severable and the unenforceability of any such provision shall not invalidate or render unenforceable any of the remaining provisions of this Agreement.

 

8.           No Attachment.

 

(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.

 

9.           Assignability. The Company may assign this Agreement and its rights and obligations under this Agreement in whole, but not in part, to any corporation or other entity with or into which the Company may hereafter merge or consolidate or to which the Company may transfer all or substantially all of its assets, if in any such case said corporation or other entity shall by operation of law or expressly in writing assume all obligations of the Company under this Agreement as fully as if it had been originally made a party to this Agreement, but may not otherwise assign this Agreement or its rights and obligations under this Agreement.  The Executive may not assign or transfer this Agreement or any rights or obligations under this Agreement.

 

10.           Notice.  For the purposes of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by certified or registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth below:

 

To the Company:

 

Cabela’s Incorporated

One Cabela Drive

Sidney, NE  69160

Attention: Legal Department

 

 

 

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To the Executive:

 

At the most recent address on file at the Company

 

11.           409A of the Code.  This Agreement is intended to comply with the requirements of Section 409A of the Code or an exception or exclusion therefrom and shall in all respects be administered in accordance with Section 409A of the Code.  Severance payments shall be made under the “separation pay” exception under Section 409A of the Code, to the maximum extent possible, and then under the “short-term deferral” exclusion under Section 409A of the Code or another applicable exception.  Within the time period permitted by the applicable Treasury Regulations, the Company may, in consultation with the Executive, modify this Agreement, in the least restrictive manner necessary and without any diminution in the value of the payments to the Executive, in order to cause the provisions of this Agreement to comply with the requirements of Section 409A of the Code so as to avoid the imposition of taxes and penalties on the Executive pursuant to Section 409A of the Code.

 

12.           Amendment; Waiver.  No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by the Executive and such officer or officers as may be specifically designated by the Board of Directors of the Company to sign on their behalf.  No waiver by any party to this Agreement at any time of any breach by any other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

 

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.

 

14.           Remedies Cumulative.  No remedy conferred upon a party by this Agreement is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and in addition to any other remedy given under this Agreement or hereinafter existing at law or in equity.

 

15.           Construction.  Any reference to any federal, state, local or foreign law, constitution, code, statute or ordinance shall be deemed to include all rules and regulations promulgated thereunder (by any governmental authority or otherwise), and any successor law, unless the context otherwise requires.  “Including” means “including without limitation” and does not limit the preceding words or terms.  The words “or” or “nor” are inclusive and include “and”.  The singular shall include the plural and vice versa.  Each word of gender shall include each other word of gender as the context may require.  The parties have each participated in the negotiation and drafting of this Agreement.  In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.

 

16.           Headings.  The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

 

17.           Validity.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provisions of this Agreement, which shall remain in full force and effect.

 

18.           Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

 

 

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19.           Payment of Costs and Legal Fees.  All reasonable costs and legal fees paid or incurred by the Executive pursuant to any dispute or question of interpretation relating to this Agreement shall be paid or reimbursed by the Company if the Executive is successful on the merits pursuant to a legal judgment, arbitration or settlement.

 

20.           Entire Agreement.  This Agreement, including the recitals to this Agreement, embodies the entire agreement between the Company and the Executive with respect to the matters agreed to in this Agreement.  All prior agreements between the Company and the Executive with respect to the matters agreed to in this Agreement, including the Original Agreement, are hereby superseded and shall have no force or effect, except that this Agreement shall not affect or operate to reduce any benefit or compensation inuring to the Executive of a kind elsewhere provided.

 

[The Remainder of This Page Intentionally Left Blank.]

 

[Signature Page Follows.]

 

 

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IN WITNESS WHEREOF, this Agreement has been executed as of the date first above written.

 

 

CABELA’S INCORPORATED, a Delaware corporation

 

 

 

 

 

By

 

 

Its

 

 

 

 

 

 

 

 

 

 

[Executive]

 

 

 

 

 


 

 

 

Management Severance Agreement

Signature Page

 

 

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