EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into
as of January 26, 1996, between KASH N' KARRY FOOD STORES, INC., a
Delaware corporation (the "Company"), and RICHARD D. COLEMAN (the
"Employee").
WHEREAS, the Company and the Employee desire to enter into
this Agreement to assure the Company of the services of the
Employee for the benefit of the Company and to set forth the
respective rights and duties of the parties hereto;
WHEREAS, the Company is in the business of owning, operating
and managing supermarkets and retail liquor, food, grocery and
warehouse format stores in Florida and may, in the future, own,
operate and manage additional supermarkets or retail liquor, food,
grocery or warehouse format stores in or outside of Florida (such
business, present and future, being hereinafter referred to as the
"Business");
NOW, THEREFORE, in consideration of the premises and the
mutual covenants, terms and conditions set forth herein, the
Company and the Employee agree as follows:
ARTICLE I.
Employment
1.1 Employment and Title. The Company hereby employs the
Employee, and the Employee hereby accepts such employment, as the
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Senior Vice President - Administration, Chief Financial Officer
and Secretary of the Company, upon the terms and conditions set
forth herein.
1.2 Services.
During the Term (as hereinafter defined) hereof, the
Employee agrees to perform diligently and in good faith such
duties and services for the Company under the direction of the
Chief Executive Officer of the Company (the "CEO") as are
consistent with the positions of Senior Vice President -
Administration, Chief Financial Officer and Secretary of the
Company. The Employee agrees to devote his best efforts and all
of his full business time, energies and abilities to the services
to be performed hereunder and for the exclusive benefit of the
Company; provided, that this clause shall not be construed to
prevent the Employee from personally, and for his own account,
trading in stocks, bonds, securities, real estate, or other forms
of investment for his own benefit, so long as any such activity
does not materially interfere with the performance of his duties
hereunder, and, provided, further, that Employee shall be entitled
to engage in those further activities permitted under Section 1.4.
The Employee shall be vested with such authority as is generally
concomitant with the positions to which he is appointed.
1.3 Location. The principal place of employment and the
location of the Employee's principal office and ordinary place of
work shall be in Tampa, Florida; provided, however, the Employee
shall, when requested by his superiors, or may, if he determines
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it to be reasonably necessary, temporarily perform services
outside said area as are reasonably required for the proper
performance of his duties under this Agreement.
1.4 Exclusivity. The Employee shall not, without the prior
written consent of the Company, directly or indirectly, during the
term of this Agreement render services of a business, professional
or commercial nature to any other person or entity, whether for
compensation or otherwise.
1.5 Representations. Each party represents and warrants to
the other that he/it has full power and authority to enter into
and perform this Agreement and that his/its execution of and
performance of this Agreement shall not constitute a default under
or breach of any of the terms of any agreement to which he/it is a
party or under which he/it is bound. Each party represents that
no consent or approval of any third party is required for his or
its execution, delivery and performance of this Agreement. The
Employee further represents and warrants to the Company that he is
free to accept this employment, and that he has no other
obligations or commitments of any kind to any one which would in
any way hinder or interfere with his acceptance of, full
performance of his obligations under, or exercise of his best
efforts with respect to, this Agreement.
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ARTICLE 2
Term
2.1 Term. The term of the Employee's employment hereunder
(the "Term") shall commence on January 26, 1996 (the "Commencement
Date") and shall continue until (but not including) the second
anniversary of the Commencement Date (the "Scheduled Termination
Date") unless earlier terminated pursuant to the provisions of
this Agreement. On or before July 24, 1997, the parties agree to
begin negotiating the terms of the Employee's employment, if any,
after the Scheduled Termination Date.
ARTICLE 3
Compensation
3.1 Salary. As compensation for the services to be
rendered by the Employee, the Company shall pay the Employee,
during the Term of this Agreement, an annual salary in the amount
of One Hundred Thirty-five Thousand Dollars ($135,000), which
salary shall accrue weekly (prorated for periods less than a week)
and shall be payable in equal weekly installments, in arrears.
3.2 Other Compensation. During the Term hereof, the
Employee shall be entitled to participate, on a basis
proportionate to the participation of the other executive officers
of the Company, in any compensatory plan, contract or arrangement
that is available to the Company's most senior executive officers
from time to time during the Term hereof, including, but not
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limited to (a) the Company's current bonus plan, generally
referred to as the Incentive Compensation Plan, as in effect on
the Commencement Date, and (b) the 1995 Key Employee's Stock
Option Plan. Effective as of March 8, 1996, the Company will
grant to the Employee options to purchase an additional 7,616
shares of the then outstanding common stock of the Company for an
exercise price of $22 5/8 per share, and on such other terms and
conditions as shall be approved by the Stock Option Committee
pursuant to the Stock Option Plan.
3.3 Benefits and Perquisites. The Employee shall be
entitled, during the Term hereof, to the same medical, hospital,
dental and life insurance coverage and benefits, vacations, and
other perquisites, as are available to the Company's most senior
executive officers on the Commencement Date or benefits that are
substantially comparable.
3.4 Withholding. Any and all amounts payable under this
Agreement, including, without limitation, amounts payable in the
event of the termination hereof under Sections 7.3 and 7.4 hereof,
are subject to withholding for such federal, state and local taxes
as the Company in its reasonable judgment determines to be
required pursuant to any applicable law, rule or regulation.
3.5 Annual Review. No less frequently than annually, the
Board of Directors shall review the Employee's performance of his
duties and services under this Agreement, and may, commensurate
with the Employee's and the Company's performance, increase, but
not decrease, the salary, stock options, other compensation and
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benefits payable to the Employee under this Agreement during the
remaining Term.
ARTICLE 4
Working Facilities, Expenses and Insurance
4.1 Working Facilities and Expenses. The Employee shall be
furnished with an office at the principal office of the Company,
or at such other location as may be agreed to by the Employee and
the Board of Directors, and other working facilities and
secretarial and other assistance suitable to his position and
adequate for the performance of his duties hereunder. The Company
shall reimburse the Employee for all the Employee's reasonable
expenses incurred while employed and performing his duties under
and in connection with the terms and conditions of the Agreement,
subject to the Employee's full appropriate documentation,
including, without limitation, receipts for all such expenses in
the manner required pursuant to Company's policies and procedures
and the Internal Revenue Code.
4.2 Insurance. The Company may secure in its own name or
otherwise, and at its own expense, life, disability and other
insurance covering the Employee or the Employee and others, and
the Employee shall not have any right, title or interest in or to
such insurance other than as expressly provided herein. The
Employee agrees to assist the Company in procuring such insurance
by submitting to the usual and customary medical and other
examinations to be conducted by such physician(s) as the Company
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or such insurance company may designate and by signing such
applications and other written instruments as may be required by
the insurance companies to which application is made for such
insurance.
ARTICLE 5
Illness or Incapacity
5.1 Right to Terminate. If, during the Term of this
Agreement, the Employee shall be unable to perform in all material
respects his duties hereunder for a period exceeding one hundred
twenty (120) consecutive calendar days, or a total of one hundred
eighty-six (186) non-consecutive calendar days, by reason of
illness or incapacity, this Agreement may be terminated by the
Company at its election pursuant to Section 7.2(b) hereof.
5.2 Right to Replace. If the Employee's illness or
incapacity, whether by physical or mental cause, renders him
unable for a minimum period of 30 consecutive calendar days to
carry out his duties and responsibilities as set forth herein, the
Company shall have the right to designate a person to temporarily
succeed the Employee in the capacity described in Article 1
hereof; provided, however, that if the Employee returns to work
from such illness or incapacity within the six (6) month period
following his inability due to illness or incapacity, he shall be
entitled to be reinstated in the capacity described in Article 1
hereof with all duties and privileges attendant thereto.
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5.3 Rights Prior to Termination. The Employee shall be
entitled to his full remuneration and benefits hereunder during
such illness or incapacity unless and until an election is made by
the Company to terminate this Agreement in accordance with the
provisions of this Article.
ARTICLE 6
Confidentiality
6.1 Confidentiality. During the Term of this Agreement and
at all times thereafter, the Employee agrees to maintain the
confidential nature of all trade secrets, including, without
limitation, development ideas, acquisition strategies and plans,
financial information, records, "know-how", methods of doing
business, customer, supplier and distributor lists and all other
confidential information of the Company. The Employee shall not
be obligated to maintain the confidential nature of information
the disclosure of which is required by law or which already is in
the public domain. The Employee shall not use (other than in
connection with his employment), in any way whatsoever, such trade
secrets except as authorized in writing by the Company. The
Employee shall, upon terminating his employment, deliver to the
Company any and all records, books, documents or any other
materials whatsoever (including all copies thereof) containing
such trade secrets, which shall be and remain the property of the
Company.
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6.2 Non-Removal of Records. All documents, papers,
materials, notes, books, correspondence, drawings and other
written and graphical records relating to the Business of the
Company which the Employee shall prepare or use, or come into
contact with, shall be and remain the sole property of the Company
and shall not be removed from their respective premises without
the Company's prior written consent.
ARTICLE 7
Termination
7.1 Termination For Cause. This Agreement and the
employment of the Employee may be terminated by the Company "For
Cause" in any of the following circumstances:
(a) The Employee has committed any act or acts of
fraud or misappropriation that result in or are intended to result
in his personal enrichment at the expense of the Company;
(b) The Employee is in default in a material respect
in the performance of his obligations, services or duties
hereunder, which shall include, without limitation, the Employee's
disregarding the written instructions (in the Company's minutes or
otherwise) from the Company's Board of Directors or his superiors
concerning the conduct of his duties hereunder, the Employee's
acting in a manner materially inconsistent with the published
policies of the Company or its affiliates, as promulgated from
time to time and which are generally applicable to all employees
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and/or senior executives of the Company, the Employee's acting in
a manner materially inconsistent with the customary standards of
performance applicable to persons in similar positions in the
supermarket industry in the United States, or if the Employee has
breached any other material provision of this Agreement; provided
that if, and only if, such default or breach is curable, the
Employee shall not be in default hereunder unless he shall have
failed to cure such default or breach within 15 days of written
notice thereof by the Company to the Employee;
(c) The Employee is grossly negligent, which causes
substantial damage or loss to the Company, or engages in willful
misconduct in the performance of his duties hereunder; provided,
however, that the Employee may be terminated under this paragraph
7.1(c) only if the disinterested directors of the Company's Board
of Directors first unanimously approve of the termination; or
(d) The Employee has engaged in illegal activities
which, individually, or in the aggregate, reflect materially
adversely upon, or have a materially adverse impact on, the
Company.
A termination For Cause under this Section 7.1 shall be
effective upon the date set forth in a written notice of
termination delivered to the Employee.
7.2 Termination Without Cause. This Agreement and the
employment of the Employee may be terminated "Without Cause" as
follows:
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(a) by mutual agreement of the parties hereto;
(b) at the election of the Company at any time by its
giving at least thirty (30) days advance written notice to the
Employee;
(c) at the election of the Employee by his giving
written notice to the Company in the event that the Company shall
default in or breach the performance of any of its obligations
under this Agreement, or in the event that the Company shall
effect a material diminution or material adverse change in the
Employee's title, responsibilities or duties; provided, that if,
and only if, such default, breach, diminution or change is
curable, the Employee may not elect to give notice under this
Section 7.2 (c), unless the Company shall have failed to cure such
default, breach, diminution or change within fifteen (15) days of
written notice thereof provided by the Employee to the Company; or
(d) upon the Employee's death.
A termination Without Cause under this Section 7.2 shall be
effective upon the date set forth in a written notice of
termination delivered hereunder, which shall be not less than
thirty (30) days nor more than 45 days after the giving of such
notice, except for a termination pursuant to Section 7.2(d)
hereof, which shall be automatically effective upon the occurrence
of the event described therein.
7.3 Effect of Termination For Cause. If the Employee's
employment is terminated For Cause:
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(a) The Employee shall be entitled to accrued salary
through the date of termination;
(b) The Employee shall be entitled to reimbursement
for expenses accrued through the date of termination in accordance
with the provisions of Section 4.1 hereof; and
(c) Except as provided in Article 11, this Agreement
shall thereupon be of no further force and effect.
7.4 Effect of Termination Without Cause. If the Employee's
employment is terminated Without Cause:
(a) The Employee shall be entitled to accrued salary
through the date of termination;
(b) The Employee shall be entitled to reimbursement
for expenses accrued through the date of termination in accordance
with the provisions of Section 4.1 hereof; and
(c) Subject to Section 7.5 and except in the case of a
termination Without Cause under Section 7.2(d), the Employee shall
be entitled to receive all amounts of salary as would have been
payable under Section 3.1 hereof through the Scheduled Termination
Date, which amounts shall be paid as and when the same would have
been payable under the Agreement had it not been terminated;
provided, however, in the case of a termination Without Cause
pursuant to Section 7.2 (c), then Employee is entitled to elect to
receive all salary due under this Section 7.4 (c) in a lump sum,
discounted to reflect the present value of that salary over the
Unexpired Term(as defined in section 7.5);
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(d) Subject to Section 7.5 and except in the case of a
termination Without Cause under Section 7.2(d), the Employee shall
be entitled to receive all medical, hospital and dental coverage
and benefits as would have been payable under Section 3.3 hereof
through the Scheduled Termination Date, which amounts shall be
paid as and when the same would have been payable under the
Agreement had it not been terminated, and if the Employee is not
entitled to participate in any such benefit plan under the terms
thereof following the termination, then the Company shall provide
the Employee with substantially identical coverage and benefits;
(e) Subject to Section 7.5, if the Employee is
participating in a Company bonus plan as of the date of
termination, he shall be entitled to an accrued bonus through the
date of termination, computed on a per diem basis based upon the
bonus which would have otherwise been payable to the Employee for
the fiscal year during which the date of termination falls had the
Agreement not been terminated, computed on the same basis as in
effect immediately prior to the date of termination, which bonus
shall be paid as and when the same would have otherwise been
payable under the bonus plan had the Agreement not been
terminated; and
(f) Except as provided in Article 11, this Agreement
shall be of no further force or effect.
7.5 Mitigation and Offset. In the event of a termination
of employment hereunder, the Employee shall be under no obligation
to seek alternative employment or other gainful occupation during
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the period from the termination of this Agreement through the
Scheduled Termination Date (the "Unexpired Term") by way of
mitigation of amounts payable to the Employee under this Article
7; provided, however, that, except in the case of Employee's
Termination Without Cause under Section 7.2 (c), if the Employee
provides, directly or indirectly (including through any personal
service entity), any services (whether as employee, consultant,
independent contractor or otherwise) to any person engaged in a
business similar to the business of the Company as then conducted
(a "Third Party") during the Unexpired Term, all amounts paid or
payable to the Employee by or on behalf of such Third Party in
respect thereof (exclusive of any fringe benefits, profit sharing
and deferred compensation arrangements customarily offered to
senior management of the Third Party) ("Offset Amounts") shall
reduce any amounts payable thereafter by the Company to the
Employee under Sections 7.4(c), (d) and (e) hereof on a dollar-
for-dollar basis. Upon the request of the Company, from time to
time, the Employee shall certify in writing to the Company all
Offset Amounts received or receivable by him and shall provide the
Company with true copies of all written agreements and a summary
of the terms of all oral agreements pursuant to which such Offset
Amounts are paid or payable to the Employee.
7.6 Full Settlement. The payments provided for in Article
7 of this Agreement are in full settlement of any claims the
Employee may have against the Company arising out of his
termination, including, but not limited to, any claims for
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wrongful discharge; provided, however, that nothing herein shall
limit any rights or obligations of the parties under any other
agreement with the Company or any pension, severance, retirement,
stock option, deferred compensation or other benefit plans of the
Company which are applicable to the Employee and which provide for
specified rights and obligations in the event of a termination of
the Employee's employment with the Company.
ARTICLE 8
Non-Competition And Non-Interference
8.1 Non-Competition. The Employee agrees that during the
Term hereof and for a period of one year thereafter, except in the
case of a Termination Without Cause, the Employee will not,
directly, indirectly or as an agent on behalf of or in conjunction
with any person, firm, partnership, corporation or other entity,
own, manage, control, join, or participate in the ownership,
management, operation, or control of, or be financially interested
in or advise, lend money to, or be employed by or provide
consulting services to, or be connected in any manner with (a) any
supermarket, retail food store, grocery store, liquor store,
warehouse store or any similar business located in market areas
where the Company operates; or (b) any company, entity or business
with which Company was in active negotiation for the purchase of a
supermarket, retail food store, grocery store, liquor store or
warehouse store at the time of termination of the Employee's
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employment, or with any other company which shall acquire such
supermarket, retail food store, grocery store, liquor store or
warehouse store. The Employee acknowledges that the business of
the Company is presently conducted throughout the counties in
Florida listed on Exhibit A attached hereto and any county
contiguous thereto and that such counties constitute the present
market area of the Company.
Ownership of less than 1% of the stock in a publicly-held
company shall not be deemed a violation of this Section 8.1.
8.2 Non-Interference. The Employee agrees that during the
Term hereof and for a period of one year thereafter, the Employee
will not, directly, indirectly or as an agent on behalf of or in
conjunction with any person, firm, partnership, corporation or
other entity, induce or entice any employee of the Company to
leave such employment or cause anyone else to do so.
8.3 Severability. If any covenant or provision contained
in Section 8.1 is determined to be void or unenforceable in whole
or in part, it shall not be deemed to affect or impair the
validity of any other covenant or provision. The parties intend
that the covenants contained in Section 8.1 shall be deemed to be
a series of separate covenants, one for each county referenced
therein. Except for geographic coverage, each such separate
covenant shall be deemed identical in terms to the covenant
contained in such Section. If, in any arbitration or judicial
proceeding, a court shall refuse to enforce all of the separate
covenants deemed included in such Section, then such unenforceable
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covenants shall be deemed eliminated from the provisions hereof
for the purpose of such proceedings to the extent necessary to
permit the remaining separate covenants to be enforced in such
proceedings.
ARTICLE 9
Remedies
9.1 Equitable Remedies. The Employee and the Company agree
that the services to be rendered by the Employee pursuant to this
Agreement, and the rights and interests granted and the
obligations to be performed by the Employee to the Company
pursuant to this Agreement, are of a special, unique,
extraordinary and intellectual character, which gives them a
peculiar value, the loss of which cannot be reasonably or
adequately compensated in damages in any action at law, and that a
breach by the Employee of any of the terms of the Agreement will
cause the Company great and irreparable injury and damage. In the
event of a breach or threatened breach of Article 6, Section 8.1
or Section 8.2, the Employee hereby expressly agrees that the
Company shall be entitled to the remedies of injunction, specific
performance and other equitable relief to prevent a breach of the
Agreement, both pendente lite and permanently, against the
Employee, as such breach would cause irreparable injury to the
Company and a remedy at law would be inadequate and insufficient.
Therefore, the Company may, in addition to pursuing its other
remedies, obtain an injunction from any court having jurisdiction
in the matter restraining any further violation. The Employee
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agrees that a bond in the amount of $5,000 shall be adequate
security for issuance of any temporary injunction. The Company
shall also be entitled to such damages as it can show it has
sustained, directly or indirectly, by reason of said breach.
9.2 Rights and Remedies Preserved. Nothing in this
Agreement except Sections 7.6 and 10.11 shall limit any right or
remedy the Company or the Employee may have under this Agreement
or pursuant to law for any breach of this Agreement by the other
party. Except as set forth in Sections 7.6 and 10.11, the rights
granted to the Company and the Employee herein are cumulative and
the election of one shall not constitute a waiver of such party's
right to assert all other legal remedies available under the
circumstances.
ARTICLE 10
Miscellaneous
10.1 No Waivers. The failure of either party to enforce any
provision of this Agreement shall not be construed as a waiver of
any such provision, nor prevent such party thereafter from
enforcing such provision or any other provision of this Agreement.
10.2 Notices. Any notice to be given to the Company and the
Employee under the terms of this Agreement may be delivered
personally, by telecopy, telex or other form of written electronic
transmission, or by registered or certified mail, postage prepaid,
and shall be addressed as follows:
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If to the Company: Ronald E. Johnson
Chief Executive Officer
Kash n' Karry Food Stores, Inc.
6422 Harney Road
Tampa, Florida 33610
Telecopier: (813) 626-9550
With a copy to: Robert S. Bolt, Esq.
Barnett, Bolt, Kirkwood & Long
601 Bayshore Boulevard
Suite 700
Tampa, Florida 33606
Telecopier: (813) 251-6711
If to the Employee: Richard D. Coleman
5005 Garrick Court
Tampa, FL 33624
Either party may hereafter notify the other in writing of any
change in address. Any notice shall be deemed duly given (i) when
personally delivered, or (ii) on the third day after it is mailed
by registered or certified mail, postage prepaid, as provided
herein.
10.3 Severability. The provisions of this Agreement are
severable and if any provision of this Agreement shall be held to
be invalid or otherwise unenforceable, in whole or in part, the
remainder of the provisions, or enforceable parts thereof, shall
not be affected thereby.
10.4 Successors and Assigns. The rights and obligations of
the Company under this Agreement shall inure to the benefit of and
be binding upon the successors and assigns of the Company,
including the survivor upon any merger, consolidation or
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combination of the Company with any other entity. The Employee
shall not have the right to assign, delegate or otherwise transfer
any duty or obligation to be performed by him hereunder to any
person or entity, nor to assign or transfer any rights hereunder.
10.5 Entire Agreement. With respect to the terms of
Employee's employment, this Agreement supersedes all prior
agreements and understandings between the parties hereto, oral or
written, and may not be modified or terminated orally. No
modification, termination or attempted waiver shall be valid
unless in writing, signed by the party against whom such
modification, termination or waiver is sought to be enforced.
This Agreement was the subject of negotiation by the parties
hereto and their counsel. The parties agree that no prior drafts
of this Agreement shall be admissible as evidence (whether in any
arbitration or court of law) in any proceeding which involves the
interpretation of any provisions of this Agreement.
10.6 Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of
Florida without reference to the conflict of law principles
thereof.
10.7 Section Headings. The section headings contained
herein are for the purposes of convenience only and are not
intended to define or limit the contents of said sections.
10.8 Further Assurances. Each party hereto shall cooperate
and shall take such further action and shall execute and deliver
such further documents as may be reasonably requested by any other
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party in order to carry out the provisions and purposes of this
Agreement.
10.9 Gender. Whenever the pronouns "he" or "his" are used
herein they shall also be deemed to mean "she" or "hers" or "it"
or "its" whenever applicable. Words in the singular shall be read
and construed as though in the plural and words in the plural
shall be read and construed as though in the singular in all cases
where they would so apply.
10.10 Counterparts. This Agreement may be executed in
counterparts, all of which taken together shall be deemed one
original.
10.11 Arbitration. The parties hereto agree that any
dispute concerning or arising out of the provisions of the
Agreement shall be resolved by arbitration in accordance with the
rules of the American Arbitration Association. Such arbitration
shall be held in Tampa, Florida and the decision of the
arbitrator(s) shall be conclusive and binding on the parties and
shall be enforceable by either party in any court of competent
jurisdiction. The arbitrator may, in his or her discretion, award
attorneys' fees and costs to such party as he or she sees fit in
rendering his or her decision. Notwithstanding the foregoing, if
any dispute arises hereunder as to which the Company desires to
exercise any rights or remedies under Section 9.1 hereof, the
Company may, in its discretion, in lieu of submitting the matter
to arbitration, bring an action thereon in any court of competent
jurisdiction in Hillsborough County, Florida, which court may
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grant any and all relief available in equity or at law. In any
such action, the prevailing party shall be entitled to reasonable
attorneys' fees and costs as may be awarded by the court.
ARTICLE 11
Survival
11.1 Survival. The provisions of Article 6, 8, 9 and 10,
and Sections 7.3, 7.4, 7.5 and 7.6 of this Agreement shall survive
the termination of this Agreement whether upon, or prior to, the
Scheduled Termination Date hereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Employment Agreement as of the date first above written.
KASH N' KARRY FOOD STORES, INC.,
a Delaware corporation
/s/ Julie Hicks By: /s/ Ronald E. Johnson
_________________________ __________________________
Name: Ronald E. Johnson
/s/ BJ Mehaffey Title: Chairman,
_________________________ President & CEO
As to the Company
/s/ Julie Hicks /s/ Richard D. Coleman
_________________________ _______________________________
RICHARD D. COLEMAN
/s/ BJ Mehaffey
______________________
As to the Employee
rsb\KnK\Coleman employment agreement dated January 26, 1996
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