EXHIBIT 10.18
CHANGE OF CONTROL AGREEMENT
AGREEMENT by and between Jitney-Jungle
Stores of America, Inc., a Mississippi corporation (the
"Company") and Michael E. Julian (the "Executive"),
dated as of the ____ day of ____________, 1999.
The Board of Directors of the Company (the
"Board"), has determined that it is in the best interest
of the Company and its shareholders to assure that
the Company will have the continued dedication of
the Executive, notwithstanding the possibility, threat
or occurrence of a Change of Control (as defined
below) of the Company. The Board believes it is
imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and
risks created by a pending or threatened Change of
Control and to encourage the Executive's full
attention and dedication to the Company currently
and in the event of any threatened or pending
Change of Control, and to provide the Executive with
compensation and benefits arrangements upon a
Change of Control which ensure that the
compensation and benefits expectations of the
Executive will be satisfied and which are competitive
with those of other corporations. Therefore, in order
to accomplish these objectives, the Board has caused
the Company to enter into this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Certain Definitions.
(a) The "Effective Date" shall mean the first
date during the Change of Control Period (as defined
in Section 1(b) on which a Change of Control (as
defined in Section 2) occurs. Anything in this
Agreement to the contrary notwithstanding, if a
Change of Control occurs and if the Executive's
employment with the Company is terminated prior to
the date on which the Change of Control occurs, and
if it is reasonably demonstrated by the Executive that
such termination of employment (i) was at the request
of a third party who has taken steps reasonably
calculated to effect the Change of Control or (ii)
otherwise arose in connection with or anticipation of
the Change of Control, then for all purposes of this
Agreement the "Effective Date" shall mean the date
immediately prior to the date of such termination of
employment.
(b) The "Change of Control Period" shall
mean the period commencing on the date hereof and
ending on the third anniversary of such date;
provided, however, that commencing on the date one
year after the date hereof, and on each annual
anniversary of such date (such date and each
anniversary thereof shall be hereinafter referred to as
the "Renewal Date"), the Change of Control Period
shall be automatically extended so as to terminate
three years from such Renewal Date, unless at least
60 days prior to the Renewal Date the Company shall
give notice to the Executive that the change of
Control Period shall not be so extended.
2. Change of Control. For the purposes of
this Agreement, a "Change of Control" shall mean:
(a) The acquisition by any individual, entity,
or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) of beneficial
ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 20% or
more of either (i) the then outstanding shares of
common stock of the Company (the "Outstanding
Company Common Stock") or (ii) the combined voting
power of the then outstanding voting securities of the
Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting
Securities"); provided, however, that the following
acquisitions shall not constitute a Change of Control:
(i) any acquisition directly from the Company, unless
such acquisition causes an individual, entity or group
(other than Bruckmann, Rosser, Sherrill & Co., L.P.)
to beneficially own more than 50% of either the
Outstanding Company Common Stock or the
Outstanding Company Voting Securities, (ii) any
acquisition by the Company or any of its subsidiaries,
(iii) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the
Company or any of its subsidiaries, (iv) any
acquisition by any corporation with respect to which,
following such acquisition, more than 60% of,
respectively, the then outstanding shares of common
stock of such corporation and the combined voting
power of the then outstanding voting securities of
such corporation entitled to vote generally in the
election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company
Common Stock and Company Voting Securities
immediately prior to such acquisition in substantially
the same proportions as their ownership, immediately
prior to such acquisition, of the Outstanding Company
Common Stock and outstanding Company Voting
Securities, as the case may be, (v) any acquisition by
an underwriter or dealer in connection with a public
offering registered under the Securities Act of 1933,
as amended; or (vi) any acquisition of the Company's
common stock from underwriters or dealers in an
initial public offering registered under the Securities
Act of 1933, as amended; provided further, however,
that if and for so long as Bruckmann, Rosser, Sherrill
& Co., L.P. beneficially owns more of both
Outstanding Company Common Stock and
Outstanding Company Voting Securities than the
acquiring individual, entity or group, a Change of
Control shall not have occurred. Shareholders party
to shareholders agreements in effect on the date of
this Agreement shall not be considered a group for
purposes of this Agreement solely as a result of such
agreements or as a result of such shareholders voting
in accordance with the terms of such agreements. In
addition, it is specifically acknowledged that, as long
as Bruckmann, Rosser, Sherrill & Co., L.P.
beneficially owns 20% or more of the Outstanding
Company Common Stock or Outstanding Company
Voting Securities, a Change of control shall not occur
solely as a result of the acquisition of additional
shares of Outstanding Company Common Stock or
Outstanding Company Voting Securities by (x)
Bruckmann, Rosser, Sherrill & Co., L.P. or (y) the
manager of Bruckmann, Rosser, Sherrill & Co., L.P.,
BRS Partners, Limited Partnership, BRSE
Associates, Inc., Bruce C. Bruckmann, Harold O.
Rosser II, Stephen C. Sherrill, Stephen F. Edwards or
Paul D. Kaminski, as long as such individual or entity
in this clause (y) does not after such acquisition
beneficially own 20% or more of such securities when
considered alone or as a part of any group of which
Bruckmann, Rosser, Sherrill & Co., L.P. is not a
member.
(b) A development whereby the individuals
who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute
at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to
the date hereof whose election, or nomination for
election by the Company's shareholders, was
approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall
be considered member of the Incumbent Board, but
excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of either
an actual or threatened election contest (such as
terms are used in Rule 14a-11 of Regulation 14A
promulgate under the Exchange Act) or other actual
or threatened solicitation of proxies or consents; or
(c) Consummation by the Company of a
reorganization, merger or consolidation, in each case,
with respect to which all or substantially all of the
individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting
Securities immediately prior to such reorganization,
merger or consolidation do not, following such
reorganization, merger or consolidation, beneficially
own, directly or indirectly, more than 60% of,
respectively, then outstanding shares of common
stock and the combined voting power of the then
outstanding voting securities entitled to vote generally
in the election of directors, as the case may be, of the
corporation resulting from such reorganization,
merger or consolidation in substantially the same
proportions as their ownership, immediately prior to
such reorganization, merger or consolidation of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case
may be; or
(d) (i) Approval by the shareholders of the
Company of a complete liquidation or dissolution of
the Company or (ii) consummation of the sale or
disposition of all or substantially all of the assets of
the Company, other than to a corporation, with
respect to which following such sale or other
disposition, more than 60% of, respectively, the then
outstanding shares of common stock of such
corporation and the combined voting power of the
then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who
were the beneficial owners, respectively, of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately
prior to such sale or other disposition in substantially
the same proportion as their ownership, immediately
prior to such sale or other disposition, of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case
may be.
3. Employment Period. The Company
hereby agrees to continue the Executive in its
employ, and the Executive hereby agrees to remain in
the employ of the Company, for the period
commencing on the Effective Date and ending on the
second anniversary of such date (the "Employment
Period").
4. Terms of Employment.
(a) Position and Duties.
(i) During the Employment Period,
(A) the Executive's position (including status,
officers, titles and reporting requirements),
authority, duties and responsibilities shall be at
least commensurate in all material respects
with the most significant of those held,
exercised and assigned at a time during the
90-day period immediately preceding the
Effective Date and (B) the Executive's services
shall be performed at the location where the
Executive was employed immediately
preceding the Effective Date or any office or
location less than 35 miles from such location.
(ii) During the Employment Period,
and excluding any periods of sick leave to
which the Executive is entitled, the Executive
agrees to devote reasonable attention and
time during normal business hours to the
business and affairs of the Company and, to
the extent necessary to discharge the
responsibilities assigned to the Executive
hereunder, to use the Executive's reasonable
best efforts to perform faithfully and efficiently
such responsibilities. During the Employment
Period it shall not be a violation of this
Agreement for the Executive to (A) serve on
corporate, civic or charitable boards or
committees, (B) deliver lectures, fulfill speaking
engagements or teach at educational
institutions and (C) manage personal
investments, so long as such activities do not
significantly interfere with the performance of
the Executive's responsibilities as an employee
of the Company in accordance with this
Agreement. It is expressly understood and
agreed that to the extent that any such
activities have been conducted by the
Executive prior to the Effective Date, the
continued conduct of such activities (or the
conduct of activities similar in nature and
scope thereto) subsequent to the Effective
Date shall not thereafter be deemed to
interfere with the performance of the
Executive's responsibilities to the Company.
(b) Compensation.
(i) Base Salary. During the
Employment Period, the Executive shall
receive an annual base salary, payable in
equal monthly installments, at least equal to
twelve times the highest monthly base salary
paid or payable to the Executive by the
Company and its affiliated companies during
the twelve month period immediately preceding
the month in which the Effective Date occurs
("Annual Base Salary"). As used in this
Agreement, the term "affiliated companies"
shall include any company controlled by,
controlling or under common control with the
Company.
(ii) Annual Bonus. In addition to
Annual Base Salary, the Executive shall be
awarded, for each fiscal year ending during the
Employment Period, an annual bonus (the
"Annual Bonus") in cash at least equal to the
average annual bonus paid or payable to the
Executive by the Company and its affiliated
companies in respect of the three fiscal years
(annualized for any fiscal year consisting of
less than twelve full months or with respect to
which the Executive has been employed by the
Company for less than twelve full months)
immediately preceding the fiscal year in which
the Effective Date occurs (the "Recent Average
Bonus"). Such annual Bonus shall be paid no
later than the third month of the fiscal year next
following the fiscal year for which the annual
Bonus is awarded, unless the Executive shall
elect to defer the receipt of such Annual
Bonus.
(iii) Incentive, Savings and
Retirement Plans. During the Employment
Period, the Executive shall be entitled to
participate in all incentive, savings and
retirement plans, practices, policies and
programs applicable generally to other peer
executives of the Company and its affiliated
companies, but in no event shall such plans,
practices, policies and programs provide the
Executive with incentive opportunities
(measured with respect to both regular and
special incentive opportunities, to the extent, if
any, that such distinction is applicable),
savings opportunities and retirement benefit
opportunities, in each case, less favorable, in
the aggregate, than the most favorable of
those provided by the Company and its
affiliated companies for the Executive under
such plans, practices, policies and programs
as in effect at any time during the 90-day
period immediately preceding the Effective
Date, or, if more favorable to the Executive,
those provided generally to other peer
executives of the company and its affiliated
companies at any time after the Effective Date.
(iv) Welfare Benefit Plans. During
the Employment Period and for a period of one
year thereafter, provided the Executive
remains employed by the Company, the
Executive and/or the Executive's family, as the
case may be shall be eligible for participation
in and shall receive all benefits under welfare
benefit plans, practices, policies and programs
provided by the Company and its affiliated
companies (including, without limitation,
medical, prescription, dental, disability, salary,
continuance, employee life, group life,
accidental death and travel accident insurance
plans and programs) to the extent applicable
generally to other peer executives of the
Company and its affiliated companies, but in
no event shall such plans, practices, policies
and programs provide the Executive with
benefits which are less favorable, in the
aggregate, than the most favorable of such
plans, practices, policies and programs in
effect for the Executive at any time during the
90-day period immediately preceding the
Effective Date or if more favorable to the
Executive, those provided generally to other
peer executives of the Company and its
affiliated companies at any time after the
Effective Date.
(v) Expenses. During the
Employment Period, the Executive shall be
entitled to receive prompt reimbursement for all
reasonable expenses incurred by the
Executive in accordance with the most
favorable policies, practices and procedures of
the Company and its affiliated companies in
effect for the Executive at any time during the
90-day period immediately preceding the
Effective Date or, if more favorable to the
Executive, as in effect generally with respect to
other peer executives of the Company and its
affiliated companies at any time thereafter.
(vi) Fringe Benefits. During the
Employment Period, the Executive shall be
entitled to fringe benefits in accordance with
the most favorable plans, practices, programs
and policies of the Company and its affiliated
companies in effect for the Executive at any
time during the 90-day period immediately
preceding the Effective Date or, if more
favorable to the Executive, as in effect
generally with respect to other peer executives
of the Company and its affiliated companies at
any time thereafter.
(vii) Office and Support Staff. During
the Employment Period, the Executive shall be
entitled to an office or offices of a size and with
furnishings and other appointments, and to
secretarial and other assistance, at least equal
to the most favorable of the foregoing provided
to the Executive by the Company and its
affiliated companies at any time during the 90-
day period immediately preceding the Effective
Date or, if more favorable to the Executive, as
provided generally with respect to other peer
executives of the Company and its affiliated
companies at any time thereafter.
(viii) Vacation. During the Employment
Period, the Executive shall be entitled to paid
vacation in accordance with the most favorable
plans, policies and practices of the Company
and its affiliated companies in effect for the
Executive at any time during the 90-day period
immediately preceding the Effective Date or, if
more favorable to the Executive, as in effect
generally with respect to other peer executives
of the Company and its affiliated companies at
any time thereafter.
5. Termination of Employment.
(a) Death or Disability. The Executive's
employment shall terminate automatically upon the
Executive's death during the Employment Period. If
the Company determines in good faith that the
Disability of the Executive has occurred during the
Employment Period (pursuant to the definition of
Disability set forth below), it may give to the Executive
written notice in accordance with Section 12(b) of this
Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's
employment with the Company shall terminate
effective on the 15th day after receipt of such notice by
the Executive (the "Disability Effective Date"),
provided that, within the 15 days after such receipt,
the Executive shall not have returned to full-time
performance of the Executive's duties. For purposes
of this Agreement, "Disability" shall mean the absence
of the Executive from the Executive's duties with the
Company on a full-time basis for 180 consecutive
business days as a result of incapacity due to mental
or physical illness which is determined to be total and
permanent by a physician selected by the Company
or its insurers and acceptable to the Executive or the
Executive's legal representative (such agreement as
to acceptability not to be withheld unreasonably).
(b) Cause The Company may terminate
the Executive's employment during the Employment
Period for Cause. For purposes of this Agreement,
"Cause" shall mean (i) repeated violations by the
Executive of the Executive's obligations under
Section 4(a) of this Agreement (other than as a result
of incapacity due to physical or mental illness) which
are demonstrably willful and deliberate on the
Executive's part, which are committed in bad faith or
without reasonable belief that such violations are in
the best interest of the Company and which are not
remedied in a reasonable period of time after receipt
of written notice from the Company specifying such
violations or (ii) the conviction of the Executive of a
felony involving moral turpitude.
(c) Good Reason. The Executive's
employment may be terminated during the
Employment Period by the Executive for Good
Reason. For purposes of this Agreement, "Good
Reason" shall mean:
(i) the assignment to the Executive
of any duties inconsistent in any respect with
the Executive's position (including status,
offices, titles and reporting requirements),
authority, duties or responsibilities as
contemplated by Section 4(a) of this
Agreement, or any other action by the
Company which results in a diminution in such
position, authority, duties and responsibilities,
excluding for this purpose an isolated,
insubstantial and inadvertent action not taken
in bad faith and which is remedied by the
Company promptly after receipt of notice
thereof given by the Executive;
(ii) any failure by the Company to
comply with any of the provisions of Section
4(b) of this Agreement, other than an isolated,
insubstantial and inadvertent failure not
occurring in bad faith and which is remedied by
the Company promptly after receipt of notice
thereof given by the Executive;
(iii) the Company's requiring the
Executive to be based at any office or location
other than that described in Section 4(a)(i)(B)
hereof;
(iv) any purported termination by the
Company of the Executive's employment
otherwise than as expressly permitted by this
Agreement; or
(v) any failure by the Company to
comply with and satisfy Section 11(c) of this
Agreement, provided that such successor has
received at least ten days prior written notice
from the Company or the Executive of the
requirements of Section 11(c) of the
Agreement.
For purposes of this Section 5(c), any good faith
determination of "Good Reason" made by the
Executive shall be conclusive.
(d) Notice of Termination. Any termination
by the Company for Cause or by the Executive for
Good Reason, shall be communicated by Notice of
Termination to the other party hereto given in
accordance with Section 12(b) of this Agreement. For
purposes of this Agreement, a "Notice of Termination"
means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon,
(ii) to the extent applicable, 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, and (iii) if the Date of
Termination (as defined below) is other than the date
of receipt of such notice, specifies the termination
date (which date shall be not more than fifteen days
after the giving of such notice). The failure by the
Executive or the Company to set forth in the Notice of
Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause
shall not waive any right of the Executive or the
Company hereunder or preclude the Executive or the
Company from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights
hereunder.
(e) Date of Termination. "Date of
Termination" means (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 any later date specified
therein, as the case may be, (ii) if the Executive's
employment is terminated by the Company other than
for Cause or Disability, the Date of Termination shall
be the date on which the Company notifies the
Executive of such termination, or (iii) if the Executive's
employment is terminated by reason of death or
Disability, the Date of Termination shall be the date of
death of the Executive or the Disability Effective Date,
as the case may be.
6. Obligations of the Company upon Termination.
(a) Good Reason; Death or Disability; Other
Than for Cause. If, during the Employment Period,
the Company shall terminate the Executive's
employment upon the Executive's death or Disability
or other than for Cause, or the Executive shall
terminate employment for Good Reason, then all
obligations of the Company and the Executive under
Section 4 shall terminate as of the Date of
Termination and:
(i) the Company shall pay to the
Executive, his estate or his beneficiary, as
applicable, in a lump sum in cash within 30
days after the Date of Termination the
aggregate of the following amounts (such
aggregate shall be hereinafter referred to as
the "Special Termination Amount"), subject to
Section 9(a)(i) of this Agreement:
(A) the sum of (1) the
Executive's Annual Base Salary through
the Date of Termination to the extent not
theretofore paid, (2) the product of (x)
the "Highest Annual Bonus" which is
equal to the greater of (i) the Annual
Bonus paid or payable to the Executive
(and annualized for any fiscal year
consisting of less than twelve full
months or for which the Executive has
been employed for less than twelve full
months) for the most recently completed
fiscal year during the Employment
Period, if any, and (ii) the Recent
Average Bonus and (y) a fraction, the
numerator of which is the number of
days in the current fiscal year through
the Date of Termination, and the
denominator of which is 365 and (3) any
compensation previously deferred by
the Executive (together with any
accrued interest or earnings thereon)
and any accrued vacation pay, in each
case to the extent not theretofore paid
(the sum of the amounts described in
clauses (1), (2) and (3) shall be
hereinafter referred to as the "Accrued
Obligations"); and
(B) provided that the payment
is approved by the separate vote of the
holders of 75% or more of the voting
power of all outstanding stock of the
Company, the amount equal to the
product of (1) two and (2) the sum of (x)
the Executive's Annual Base Salary and
(y) the Highest Annual Bonus; provided,
however, that such amount shall be paid
in lieu of, and the Executive hereby
waives the right to receive, any other
amount of severance relating to salary
or bonus continuation to be received by
the Executive upon such termination of
employment under any severance plan,
policy or arrangement of the Company;
and
(ii) for the period from the Date of
Termination through the first anniversary of
such date, or such longer period as any plan,
program, practice or policy may provide, the
Company shall continue to provide Executive
an automobile at least in the manner as has
been provided in accordance with the plans,
programs, practices and policies described in
Section 4(b)(vi) of this Agreement and shall
also continue benefits to the Executive and/or
the Executive's family at least equal to those
which would have been provided to them in
accordance with the plans, programs, practices
and policies described in Section 4(b)(iv) of
this Agreement if the Executive's employment
had not been terminated in accordance with
the most favorable plans, practices, programs
or policies of the Company and its affiliated
companies applicable generally to other peer
executives and their families during the 90-day
period immediately preceding the Effective
Date or, if more favorable to the Executive, as
in effect generally with respect to other peer
executives of the Company and its affiliated
companies and their families at any time
thereafter, provided, however, that if the
Executive becomes reemployed with another
employer, all such benefits shall terminate
upon such employment. Notwithstanding the
foregoing, when the Company's obligations to
provide benefits under this paragraph
terminate, the Executive will have the right to
continue such benefits at his own expense for
eighteen months. The Executive shall notify
the Company promptly upon his acceptance of
new employment. The Executive shall notify
the Company promptly upon his acceptance of
new employment. For purposes of determining
eligibility of the Executive for retiree benefits
pursuant to such plans, practices, programs
and policies, the Executive shall be considered
to have remained employed until the end of the
Employment Period and to have retired on the
last day of such period; and
(iii) to the extent not theretofore paid
or provided, subject to Section 9(a)(i) of this
Agreement, the Company shall timely pay or
provide to the Executive, his estate or his
beneficiary, as applicable, any other amounts
or benefits required to be paid or provided or
which the Executive, his estate or his
beneficiary, as applicable, is eligible to receive
pursuant to this Agreement and any plan,
program, policy or practice or contract or
agreement of the Company and its affiliated
companies (such other amounts and benefits
shall be hereinafter referred to as the "Other
Benefits"); and
(iv) if the Executive's employment is
terminated by reason of the Executive's death
during the Employment Period, anything in this
Agreement to the contrary notwithstanding, the
Executive's family shall be entitled to receive
benefits at least equal to the most favorable
benefits provided by the Company and any of
its affiliated companies to surviving families of
peer executives of the Company and such
affiliated companies under such plans,
programs, practices and policies relating to
family death benefits, if any, as in effect with
respect to other peer executives and their
families at any time during the 90-day period
immediately preceding the Effective Date or, if
more favorable to the Executive and/or the
Executive's family, as in effect on the date of
the Executive's death with respect to other
peer executives of the Company and its
affiliated companies and their families; and
(v) if the Executive's employment is
terminated by reason of the Executive's
Disability during the Employment Period,
anything in this Agreement to the contrary
notwithstanding, the Executive shall be entitled
after the Disability Effective Date to receive
disability and other benefits at least equal to
the most favorable to those generally provided
by the Company and its affiliated companies to
disabled executives and/or their families in
accordance with such plans, programs,
practices and policies relating to disability, if
any, as in effect generally with respect to other
peer executives and their families at any time
during the 90-day period immediately
preceding the Effective Date or, if more
favorable to the Executive and/or the
Executive's family, as in effect at any time
thereafter generally with respect to other peer
executives of the Company and its affiliated
companies and their families.
(b) Cause; Other than for Good Reason. If
the Executive's employment shall be terminated for
cause during the Employment Period, this Agreement
shall terminate without further obligations to the
Executive other than the obligation to pay to the
Executive Annual Base Salary through the Date of
Termination plus the amount of any compensation
previously deferred by the Executive, if each case to
the extent theretofore unpaid, and the timely payment
or provision of Other Benefits. If the Executive
terminates employment during the Employment
Period, excluding a termination for Good Reason, this
Agreement shall terminate without further obligations
to the Executive, other than for Accrued Obligations
and the timely payment or provision of Other Benefits;
in such case, all Accrued Obligations shall be paid to
the Executive in a lump sum in cash within 30 days of
the Date of Termination.
(c) Termination Following the Expiration of
the Employment Period. If the Executive's
employment shall be terminated by the Company
without Cause during the one-year period following
the expiration of the Employment Period, for the
remainder of such one-year period, or such longer
period as any plan, program, practice or policy may
provide, the Company shall continue benefits to the
Executive and/or the Executive's family at least equal
to those which would have been provided to them in
accordance with the plans, programs, practices and
policies described in Section 4(b)(iv) of this
Agreement if the Executive's employment had not
been terminated in accordance with the most
favorable plans, practices, programs or policies of the
Company and its affiliated companies applicable
generally to other peer executives and their families
during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive,
as in effect generally with respect to other peer
executives of the Company and its affiliated
companies and their families at any time thereafter,
provided, however, that if the Executive becomes
reemployed with another employer, all such benefits
shall terminate upon such employment.
Notwithstanding the foregoing, when the Company's
obligations to provide benefits under this paragraph
terminate, the Executive will have the right to continue
such benefits at his own expense for eighteen
months.
7. Non-Exclusivity of Rights. Except as
provided in Sections 6(a)(i)(B), 6(a)(ii) and 12(f) of
this Agreement, nothing in this Agreement shall
prevent or limit the Executive's continuing or future
participation in any plan, program, policy or practice
provided by the Company or any of its affiliated
companies and for which the Executive may qualify,
nor shall anything herein limit or otherwise affect such
rights as the Executive may have under any contract
or agreement with the Company or any of its affiliated
companies. Amounts which are vested benefits or
which the Executive is otherwise entitled to receive
under any plan, policy, practice or program of or any
contract or agreement with the Company or any of its
affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such
plan, policy, practice or program or contract or
agreement except as explicitly modified by this
Agreement.
8. Full Settlement. The Company's
obligation to make the payments provided for in this
Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim,
right or action which the Company may have against
the Executive or others. In no event shall the
Executive be obligated to seek other employment or
take any other action by way of mitigation of the
amounts payable to the Executive under any of the
provisions of this Agreement and, except as provided
in Section 6(a)(ii) of this Agreement, such amounts
shall not be reduced whether or not the Executive
obtains other employment. The Company agrees to
pay, to the full extent permitted by law, all legal fees
and expenses which the Executive may reasonably
incur as a result of any contest (regardless of the
outcome thereof) by the Company, the Executive or
others of the validity or enforceability of, or liability
under, any provision of this Agreement or any
guarantee of performance thereof (including as a
result of any contest by the Executive about the
amount of any payment pursuant to his Agreement),
plus in each case interest on any delayed payment at
the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Internal Revenue Code of 1986,
as amended (the "Code").
9. Certain Reductions in the Payment by the Company.
(a) Anything in this Agreement to the
contrary notwithstanding, in the event it shall be
determined that any payment or distribution by the
Company to or for the Employee's benefit (whether
paid or payable or distributed or distributed pursuant
to the terms of this Agreement or otherwise) (a
"Payment") would be nondeductible by the Company
for Federal income tax purposes because of Section
280G of the Code, then the aggregate present value
of amounts payable or distributable to or for the
Executive's benefit pursuant to this Agreement (such
payments or distributions pursuant to this Agreement
are hereinafter referred to as "Agreement Payments")
shall be reduced (but not below zero) to the Reduced
Amount. The "Reduced Amount" shall be the greater
of (i) the highest aggregate present value of
Agreement Payments that can be paid without
causing any payments or benefits hereunder to be an
Excess Parachute Payment or (ii) the largest portion,
up to and including the total, of the Agreement
Payments that after taking into account all applicable
state and Federal taxes (computed at the highest
applicable marginal rate) including any taxes payable
pursuant to Section 4999 of the Code, results in a
greater after-tax benefit to the Executive than the
after-tax benefit to the Executive of the amount
calculated under (i) hereof (computed at the highest
applicable marginal rate). For purposes of this
Section 9, present value shall be determined in
accordance with Section 280G(d)(4) of the Code.
(b) Subject to the provisions of Section 9(c),
all determinations required to be made under this
Section 9 shall be made by the Company's
independent accountants (the "Accounting Firm")
which shall provide detailed supporting calculations
both to the Company and the Executive within 15
business days of the receipt of notice from the
Executive that there has been a Payment, or such
earlier time as is requested by the Company. In the
event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the Executive
and the Company shall mutually appoint another
accounting firm to make the determinations required
hereunder. All fees and expenses of the Accounting
Firm shall be borne solely by the Company. If the
Accounting Firm determines that no Excise Tax is
payable by the Executive, it shall furnish the
Executive with a written opinion that failure to report
the Excise Tax on the Executive's applicable federal
income tax return would not result in the imposition of
a negligence or similar penalty. Any determination by
the Accounting Firm shall be binding upon the
Company and the Executive. If the Accounting Firm
determines that a reduction pursuant to Section 9(a)
is necessary, the Employee shall determine which
and how much of the Agreement Payments (or, at the
election of the Employee, other payments) shall be
eliminated or reduced consistent with the
requirements of this Section 9, provided that, if the
Employee does not make such determination within
ten business days of the receipt of the calculations
made by the Accounting Firm the Company shall
elect which and how much of the Agreement
Payments shall be eliminated or reduced consistent
with the Requirements of this Section 9 and shall
notify the Employee promptly of such election. Within
five business days thereafter, the Company shall pay
the Employee or distribute to or for the Employee's
benefit such amounts as are then due to the
Employee under this Agreement.
(c) As a result of the uncertainty in the
application of Section 280G of the Code at the time of
the initial determination by the Accounting Firm
hereunder, it is possible that Agreement Payments
will have been made by the Company which should
not have been made ("Overpayment") or that
additional Agreement Payments which will have not
been made by the Company could have been made
("Underpayment"), in each case, consistent with the
calculations required to be made hereunder. In the
event that the Accounting Firm determines that an
Overpayment has been made, any such
Overpayment shall be treated for all purposes as a
loan to the Employee which the Employee shall repay
to the Company together with interest at the
applicable Federal rate provided for in Section
7872(f)(2) of the Code. In the event that the
Accounting Firm determines that an Underpayment
has occurred, any such Underpayment shall be
promptly paid by the Company to or for the benefit of
the Employee together with interest at the applicable
Federal rate provided for in Section 7872(f)(2) of the
Code.
10. Confidential Information. The Executive
shall hold in a fiduciary capacity for the benefit of the
Company all secret or confidential information,
knowledge or data relating to the Company or any of
its affiliated companies, and their respective
businesses, which shall have been obtained by the
Executive during the Executive's employment by the
Company or any of its affiliated companies and which
shall not be or become public knowledge (other than
by acts by the Executive or representatives of the
Executive in violation of this Agreement). After
termination of the Executive's employment with the
Company, the Executive shall not, without the prior
written consent of the Company or as may otherwise
be required by law or legal process, communicate or
divulge any such information, knowledge or data to
anyone other than the Company and those
designated by it. In no event shall an asserted
violation of the provisions of this Section 10 constitute
a basis for deferring or withholding any amounts
otherwise payable to the Executive under this
Agreement.
11. Successors. (a) This Agreement is
personal to the Executive and without the prior written
consent of the Company shall not be assignable by
the Executive otherwise than by will or the laws of
descent and distribution. This Agreement shall inure
to the benefit of an be enforceable by the Executive's
legal representative.
(b) This Agreement shall inure to the
benefit of and be binding upon the Company and its
successors and assigns.
(c) The Company will require any
successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the
Company to assume expressly and agree to perform
this Agreement in the same manner and to the same
extent that the Company would be required to
perform it if no such succession had taken place. As
used in this Agreement, "Company" shall mean the
Company as hereinbefore defined and any successor
to its business and/or assets as aforesaid which
assumes and agrees to perform this Agreement by
operation of law, or otherwise.
12. Miscellaneous.
(a) This Agreement shall be governed by
and construed in accordance with the laws of the
State of Mississippi without reference to principles of
conflict of laws. The captions of this Agreement are
not part of the provisions hereof and shall have no
force or effect. This Agreement may not be amended
or modified otherwise than by a written agreement
executed by the parties hereto or their respective
successors and legal representative.
(b) All notices and other communications
hereunder shall be in writing and shall be given by
hand delivery to the other party or by registered or
certified mail, return receipt requested, postage
prepaid, addressed as follows:
If to the Executive:
At the home address reflected in the
Company's personnel records.
If to the Company:
Jitney-Jungle Stores of America, Inc.
1770 Ellis Avenue, Suite 200
Jackson, MS 39204
Attention: Chief Executive Officer
or to such other address as either party shall have
furnished to the other in writing in accordance
herewith. Notice and communications shall be
effective when actually received by the addressee.
(c) The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity
or enforceability of any other provision of this
Agreement.
(d) The Company may withhold from any
amounts payable under this Agreement such Federal,
state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
(e) The Executive's or the Company's
failure to insist upon strict compliance with any
provision hereof or any other provision of this
Agreement or the failure to asset any right the
Executive or the Company may have hereunder,
including, without limitation, the right of the Executive
to terminate employment for Good Reason pursuant
to Section 5(c)(i)-(v) of this Agreement, shall not be
deemed to be a waiver of such provision or right or
any other provision or right of this Agreement.
(f) The Executive and the Company
acknowledge that, except as may otherwise be
provided under any other written employment
agreement between the Executive and the Company,
the employment of the Executive by the Company is
"at will" and, prior to the Effective Date, may be
terminated by either the Executive or the Company at
any time. Moreover, if prior to the Effective Date the
Executive's employment with the Company
terminates, then the Executive shall have no further
rights under this Agreement. If the Executive has a
written employment agreement with the Company,
that agreement shall be superseded by this
Agreement upon a Change of Control; provided, that
the salary, bonus, incentive, savings, retirement,
welfare benefits, expense reimbursement, fringe
benefits, office and support staff and vacation
provisions, if any, of such agreement shall provide the
applicable measure of compensation provided to the
Executive by the Company and its affiliated
companies prior to the Change of Control for
purposes of this Agreement (unless the Company and
its affiliated companies in fact provided compensation
higher than the compensation required to be provided
under the agreement, in which case the higher
amount or benefit shall apply), but provided further,
however, that any provisions with respect to
severance benefits in such agreement shall no longer
be applicable and shall be replaced by the benefits
provided under this Agreement. Notwithstanding
anything herein to the contrary, the provisions of
Section 10 of that certain Employment Agreement
between the Executive and Company dated effective
February 23, 1997 shall continue even after this
Agreement is effective unless otherwise modified in
writing by both the Executive and the Company.
IN WITNESS WHEREOF, the Executive
has hereunto set the Executive's hand and, pursuant
to the authorization from its Board of Directors, the
Company has caused these presents to be executed
in its name on its behalf, all as of the day and year
first above written.
EXECUTIVE:
Name: Michael E. Julian
JITNEY-JUNGLE STORES OF AMERICA,
INC.:
By:
Name:
Title:
CHANGE OF CONTROL AGREEMENT
AGREEMENT by and between Jitney-Jungle
Stores of America, Inc., a Mississippi corporation (the
"Company") and Ronald E. Johnson (the "Executive"),
dated as of the ____ day of ____________, 1999.
The Board of Directors of the Company (the
"Board"), has determined that it is in the best interest
of the Company and its shareholders to assure that
the Company will have the continued dedication of
the Executive, notwithstanding the possibility, threat
or occurrence of a Change of Control (as defined
below) of the Company. The Board believes it is
imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and
risks created by a pending or threatened Change of
Control and to encourage the Executive's full
attention and dedication to the Company currently
and in the event of any threatened or pending
Change of Control, and to provide the Executive with
compensation and benefits arrangements upon a
Change of Control which ensure that the
compensation and benefits expectations of the
Executive will be satisfied and which are competitive
with those of other corporations. Therefore, in order
to accomplish these objectives, the Board has caused
the Company to enter into this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Certain Definitions.
(a) The "Effective Date" shall mean the first
date during the Change of Control Period (as defined
in Section 1(b) on which a Change of Control (as
defined in Section 2) occurs. Anything in this
Agreement to the contrary notwithstanding, if a
Change of Control occurs and if the Executive's
employment with the Company is terminated prior to
the date on which the Change of Control occurs, and
if it is reasonably demonstrated by the Executive that
such termination of employment (i) was at the request
of a third party who has taken steps reasonably
calculated to effect the Change of Control or (ii)
otherwise arose in connection with or anticipation of
the Change of Control, then for all purposes of this
Agreement the "Effective Date" shall mean the date
immediately prior to the date of such termination of
employment.
(b) The "Change of Control Period" shall
mean the period commencing on the date hereof and
ending on the third anniversary of such date;
provided, however, that commencing on the date one
year after the date hereof, and on each annual
anniversary of such date (such date and each
anniversary thereof shall be hereinafter referred to as
the "Renewal Date"), the Change of Control Period
shall be automatically extended so as to terminate
three years from such Renewal Date, unless at least
60 days prior to the Renewal Date the Company shall
give notice to the Executive that the change of
Control Period shall not be so extended.
2. Change of Control. For the purposes of
this Agreement, a "Change of Control" shall mean:
(a) The acquisition by any individual, entity,
or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) of beneficial
ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 20% or
more of either (i) the then outstanding shares of
common stock of the Company (the "Outstanding
Company Common Stock") or (ii) the combined voting
power of the then outstanding voting securities of the
Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting
Securities"); provided, however, that the following
acquisitions shall not constitute a Change of Control:
(i) any acquisition directly from the Company, unless
such acquisition causes an individual, entity or group
(other than Bruckmann, Rosser, Sherrill & Co., L.P.)
to beneficially own more than 50% of either the
Outstanding Company Common Stock or the
Outstanding Company Voting Securities, (ii) any
acquisition by the Company or any of its subsidiaries,
(iii) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the
Company or any of its subsidiaries, (iv) any
acquisition by any corporation with respect to which,
following such acquisition, more than 60% of,
respectively, the then outstanding shares of common
stock of such corporation and the combined voting
power of the then outstanding voting securities of
such corporation entitled to vote generally in the
election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company
Common Stock and Company Voting Securities
immediately prior to such acquisition in substantially
the same proportions as their ownership, immediately
prior to such acquisition, of the Outstanding Company
Common Stock and outstanding Company Voting
Securities, as the case may be, (v) any acquisition by
an underwriter or dealer in connection with a public
offering registered under the Securities Act of 1933,
as amended; or (vi) any acquisition of the Company's
common stock from underwriters or dealers in an
initial public offering registered under the Securities
Act of 1933, as amended; provided further, however,
that if and for so long as Bruckmann, Rosser, Sherrill
& Co., L.P. beneficially owns more of both
Outstanding Company Common Stock and
Outstanding Company Voting Securities than the
acquiring individual, entity or group, a Change of
Control shall not have occurred. Shareholders party
to shareholders agreements in effect on the date of
this Agreement shall not be considered a group for
purposes of this Agreement solely as a result of such
agreements or as a result of such shareholders voting
in accordance with the terms of such agreements. In
addition, it is specifically acknowledged that, as long
as Bruckmann, Rosser, Sherrill & Co., L.P.
beneficially owns 20% or more of the Outstanding
Company Common Stock or Outstanding Company
Voting Securities, a Change of control shall not occur
solely as a result of the acquisition of additional
shares of Outstanding Company Common Stock or
Outstanding Company Voting Securities by (x)
Bruckmann, Rosser, Sherrill & Co., L.P. or (y) the
manager of Bruckmann, Rosser, Sherrill & Co., L.P.,
BRS Partners, Limited Partnership, BRSE
Associates, Inc., Bruce C. Bruckmann, Harold O.
Rosser II, Stephen C. Sherrill, Stephen F. Edwards or
Paul D. Kaminski, as long as such individual or entity
in this clause (y) does not after such acquisition
beneficially own 20% or more of such securities when
considered alone or as a part of any group of which
Bruckmann, Rosser, Sherrill & Co., L.P. is not a
member.
(b) A development whereby the individuals
who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute
at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to
the date hereof whose election, or nomination for
election by the Company's shareholders, was
approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall
be considered member of the Incumbent Board, but
excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of either
an actual or threatened election contest (such as
terms are used in Rule 14a-11 of Regulation 14A
promulgate under the Exchange Act) or other actual
or threatened solicitation of proxies or consents; or
(c) Consummation by the Company of a
reorganization, merger or consolidation, in each case,
with respect to which all or substantially all of the
individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting
Securities immediately prior to such reorganization,
merger or consolidation do not, following such
reorganization, merger or consolidation, beneficially
own, directly or indirectly, more than 60% of,
respectively, then outstanding shares of common
stock and the combined voting power of the then
outstanding voting securities entitled to vote generally
in the election of directors, as the case may be, of the
corporation resulting from such reorganization,
merger or consolidation in substantially the same
proportions as their ownership, immediately prior to
such reorganization, merger or consolidation of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case
may be; or
(d) (i) Approval by the shareholders of the
Company of a complete liquidation or dissolution of
the Company or (ii) consummation of the sale or
disposition of all or substantially all of the assets of
the Company, other than to a corporation, with
respect to which following such sale or other
disposition, more than 60% of, respectively, the then
outstanding shares of common stock of such
corporation and the combined voting power of the
then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who
were the beneficial owners, respectively, of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately
prior to such sale or other disposition in substantially
the same proportion as their ownership, immediately
prior to such sale or other disposition, of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case
may be.
3. Employment Period. The Company
hereby agrees to continue the Executive in its
employ, and the Executive hereby agrees to remain in
the employ of the Company, for the period
commencing on the Effective Date and ending on the
second anniversary of such date (the "Employment
Period").
4. Terms of Employment.
(a) Position and Duties.
(i) During the Employment Period,
(A) the Executive's position (including status,
officers, titles and reporting requirements),
authority, duties and responsibilities shall be at
least commensurate in all material respects
with the most significant of those held,
exercised and assigned at a time during the
90-day period immediately preceding the
Effective Date and (B) the Executive's services
shall be performed at the location where the
Executive was employed immediately
preceding the Effective Date or any office or
location less than 35 miles from such location.
(ii) During the Employment Period,
and excluding any periods of sick leave to
which the Executive is entitled, the Executive
agrees to devote reasonable attention and
time during normal business hours to the
business and affairs of the Company and, to
the extent necessary to discharge the
responsibilities assigned to the Executive
hereunder, to use the Executive's reasonable
best efforts to perform faithfully and efficiently
such responsibilities. During the Employment
Period it shall not be a violation of this
Agreement for the Executive to (A) serve on
corporate, civic or charitable boards or
committees, (B) deliver lectures, fulfill speaking
engagements or teach at educational
institutions and (C) manage personal
investments, so long as such activities do not
significantly interfere with the performance of
the Executive's responsibilities as an employee
of the Company in accordance with this
Agreement. It is expressly understood and
agreed that to the extent that any such
activities have been conducted by the
Executive prior to the Effective Date, the
continued conduct of such activities (or the
conduct of activities similar in nature and
scope thereto) subsequent to the Effective
Date shall not thereafter be deemed to
interfere with the performance of the
Executive's responsibilities to the Company.
(b) Compensation.
(i) Base Salary. During the
Employment Period, the Executive shall
receive an annual base salary, payable in
equal monthly installments, at least equal to
twelve times the highest monthly base salary
paid or payable to the Executive by the
Company and its affiliated companies during
the twelve month period immediately preceding
the month in which the Effective Date occurs
("Annual Base Salary"). As used in this
Agreement, the term "affiliated companies"
shall include any company controlled by,
controlling or under common control with the
Company.
(ii) Annual Bonus. In addition to
Annual Base Salary, the Executive shall be
awarded, for each fiscal year ending during the
Employment Period, an annual bonus (the
"Annual Bonus") in cash at least equal to the
average annual bonus paid or payable to the
Executive by the Company and its affiliated
companies in respect of the three fiscal years
(annualized for any fiscal year consisting of
less than twelve full months or with respect to
which the Executive has been employed by the
Company for less than twelve full months)
immediately preceding the fiscal year in which
the Effective Date occurs (the "Recent Average
Bonus"). Such annual Bonus shall be paid no
later than the third month of the fiscal year next
following the fiscal year for which the annual
Bonus is awarded, unless the Executive shall
elect to defer the receipt of such Annual
Bonus.
(iii) Incentive, Savings and
Retirement Plans. During the Employment
Period, the Executive shall be entitled to
participate in all incentive, savings and
retirement plans, practices, policies and
programs applicable generally to other peer
executives of the Company and its affiliated
companies, but in no event shall such plans,
practices, policies and programs provide the
Executive with incentive opportunities
(measured with respect to both regular and
special incentive opportunities, to the extent, if
any, that such distinction is applicable),
savings opportunities and retirement benefit
opportunities, in each case, less favorable, in
the aggregate, than the most favorable of
those provided by the Company and its
affiliated companies for the Executive under
such plans, practices, policies and programs
as in effect at any time during the 90-day
period immediately preceding the Effective
Date, or, if more favorable to the Executive,
those provided generally to other peer
executives of the company and its affiliated
companies at any time after the Effective Date.
(iv) Welfare Benefit Plans. During
the Employment Period and for a period of one
year thereafter, provided the Executive
remains employed by the Company, the
Executive and/or the Executive's family, as the
case may be shall be eligible for participation
in and shall receive all benefits under welfare
benefit plans, practices, policies and programs
provided by the Company and its affiliated
companies (including, without limitation,
medical, prescription, dental, disability, salary,
continuance, employee life, group life,
accidental death and travel accident insurance
plans and programs) to the extent applicable
generally to other peer executives of the
Company and its affiliated companies, but in
no event shall such plans, practices, policies
and programs provide the Executive with
benefits which are less favorable, in the
aggregate, than the most favorable of such
plans, practices, policies and programs in
effect for the Executive at any time during the
90-day period immediately preceding the
Effective Date or if more favorable to the
Executive, those provided generally to other
peer executives of the Company and its
affiliated companies at any time after the
Effective Date.
(v) Expenses. During the
Employment Period, the Executive shall be
entitled to receive prompt reimbursement for all
reasonable expenses incurred by the
Executive in accordance with the most
favorable policies, practices and procedures of
the Company and its affiliated companies in
effect for the Executive at any time during the
90-day period immediately preceding the
Effective Date or, if more favorable to the
Executive, as in effect generally with respect to
other peer executives of the Company and its
affiliated companies at any time thereafter.
(vi) Fringe Benefits. During the
Employment Period, the Executive shall be
entitled to fringe benefits in accordance with
the most favorable plans, practices, programs
and policies of the Company and its affiliated
companies in effect for the Executive at any
time during the 90-day period immediately
preceding the Effective Date or, if more
favorable to the Executive, as in effect
generally with respect to other peer executives
of the Company and its affiliated companies at
any time thereafter.
(vii) Office and Support Staff. During
the Employment Period, the Executive shall be
entitled to an office or offices of a size and with
furnishings and other appointments, and to
secretarial and other assistance, at least equal
to the most favorable of the foregoing provided
to the Executive by the Company and its
affiliated companies at any time during the 90-
day period immediately preceding the Effective
Date or, if more favorable to the Executive, as
provided generally with respect to other peer
executives of the Company and its affiliated
companies at any time thereafter.
(viii) Vacation. During the Employment
Period, the Executive shall be entitled to paid
vacation in accordance with the most favorable
plans, policies and practices of the Company
and its affiliated companies in effect for the
Executive at any time during the 90-day period
immediately preceding the Effective Date or, if
more favorable to the Executive, as in effect
generally with respect to other peer executives
of the Company and its affiliated companies at
any time thereafter.
5. Termination of Employment.
(a) Death or Disability. The Executive's
employment shall terminate automatically upon the
Executive's death during the Employment Period. If
the Company determines in good faith that the
Disability of the Executive has occurred during the
Employment Period (pursuant to the definition of
Disability set forth below), it may give to the Executive
written notice in accordance with Section 12(b) of this
Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's
employment with the Company shall terminate
effective on the 15th day after receipt of such notice by
the Executive (the "Disability Effective Date"),
provided that, within the 15 days after such receipt,
the Executive shall not have returned to full-time
performance of the Executive's duties. For purposes
of this Agreement, "Disability" shall mean the absence
of the Executive from the Executive's duties with the
Company on a full-time basis for 180 consecutive
business days as a result of incapacity due to mental
or physical illness which is determined to be total and
permanent by a physician selected by the Company
or its insurers and acceptable to the Executive or the
Executive's legal representative (such agreement as
to acceptability not to be withheld unreasonably).
(b) Cause The Company may terminate
the Executive's employment during the Employment
Period for Cause. For purposes of this Agreement,
"Cause" shall mean (i) repeated violations by the
Executive of the Executive's obligations under
Section 4(a) of this Agreement (other than as a result
of incapacity due to physical or mental illness) which
are demonstrably willful and deliberate on the
Executive's part, which are committed in bad faith or
without reasonable belief that such violations are in
the best interest of the Company and which are not
remedied in a reasonable period of time after receipt
of written notice from the Company specifying such
violations or (ii) the conviction of the Executive of a
felony involving moral turpitude.
(c) Good Reason. The Executive's
employment may be terminated during the
Employment Period by the Executive for Good
Reason. For purposes of this Agreement, "Good
Reason" shall mean:
(i) the assignment to the Executive
of any duties inconsistent in any respect with
the Executive's position (including status,
offices, titles and reporting requirements),
authority, duties or responsibilities as
contemplated by Section 4(a) of this
Agreement, or any other action by the
Company which results in a diminution in such
position, authority, duties and responsibilities,
excluding for this purpose an isolated,
insubstantial and inadvertent action not taken
in bad faith and which is remedied by the
Company promptly after receipt of notice
thereof given by the Executive;
(ii) any failure by the Company to
comply with any of the provisions of Section
4(b) of this Agreement, other than an isolated,
insubstantial and inadvertent failure not
occurring in bad faith and which is remedied by
the Company promptly after receipt of notice
thereof given by the Executive;
(iii) the Company's requiring the
Executive to be based at any office or location
other than that described in Section 4(a)(i)(B)
hereof;
(iv) any purported termination by the
Company of the Executive's employment
otherwise than as expressly permitted by this
Agreement; or
(v) any failure by the Company to
comply with and satisfy Section 11(c) of this
Agreement, provided that such successor has
received at least ten days prior written notice
from the Company or the Executive of the
requirements of Section 11(c) of the
Agreement.
For purposes of this Section 5(c), any good faith
determination of "Good Reason" made by the
Executive shall be conclusive.
(d) Notice of Termination. Any termination
by the Company for Cause or by the Executive for
Good Reason, shall be communicated by Notice of
Termination to the other party hereto given in
accordance with Section 12(b) of this Agreement. For
purposes of this Agreement, a "Notice of Termination"
means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon,
(ii) to the extent applicable, 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, and (iii) if the Date of
Termination (as defined below) is other than the date
of receipt of such notice, specifies the termination
date (which date shall be not more than fifteen days
after the giving of such notice). The failure by the
Executive or the Company to set forth in the Notice of
Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause
shall not waive any right of the Executive or the
Company hereunder or preclude the Executive or the
Company from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights
hereunder.
(e) Date of Termination. "Date of
Termination" means (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 any later date specified
therein, as the case may be, (ii) if the Executive's
employment is terminated by the Company other than
for Cause or Disability, the Date of Termination shall
be the date on which the Company notifies the
Executive of such termination, or (iii) if the Executive's
employment is terminated by reason of death or
Disability, the Date of Termination shall be the date of
death of the Executive or the Disability Effective Date,
as the case may be.
6. Obligations of the Company upon Termination.
(a) Good Reason; Death or Disability; Other
Than for Cause. If, during the Employment Period,
the Company shall terminate the Executive's
employment upon the Executive's death or Disability
or other than for Cause, or the Executive shall
terminate employment for Good Reason, then all
obligations of the Company and the Executive under
Section 4 shall terminate as of the Date of
Termination and:
(i) the Company shall pay to the
Executive, his estate or his beneficiary, as
applicable, in a lump sum in cash within 30
days after the Date of Termination the
aggregate of the following amounts (such
aggregate shall be hereinafter referred to as
the "Special Termination Amount"), subject to
Section 9(a)(i) of this Agreement:
(A) the sum of (1) the
Executive's Annual Base Salary through
the Date of Termination to the extent not
theretofore paid, (2) the product of (x)
the "Highest Annual Bonus" which is
equal to the greater of (i) the Annual
Bonus paid or payable to the Executive
(and annualized for any fiscal year
consisting of less than twelve full
months or for which the Executive has
been employed for less than twelve full
months) for the most recently completed
fiscal year during the Employment
Period, if any, and (ii) the Recent
Average Bonus and (y) a fraction, the
numerator of which is the number of
days in the current fiscal year through
the Date of Termination, and the
denominator of which is 365 and (3) any
compensation previously deferred by
the Executive (together with any
accrued interest or earnings thereon)
and any accrued vacation pay, in each
case to the extent not theretofore paid
(the sum of the amounts described in
clauses (1), (2) and (3) shall be
hereinafter referred to as the "Accrued
Obligations"); and
(B) provided that the payment
is approved by the separate vote of the
holders of 75% or more of the voting
power of all outstanding stock of the
Company, the amount equal to the
product of (1) two and (2) the sum of (x)
the Executive's Annual Base Salary and
(y) the Highest Annual Bonus; provided,
however, that such amount shall be paid
in lieu of, and the Executive hereby
waives the right to receive, any other
amount of severance relating to salary
or bonus continuation to be received by
the Executive upon such termination of
employment under any severance plan,
policy or arrangement of the Company;
and
(ii) for the period from the Date of
Termination through the first anniversary of
such date, or such longer period as any plan,
program, practice or policy may provide, the
Company shall continue to provide Executive
an automobile at least in the manner as has
been provided in accordance with the plans,
programs, practices and policies described in
section 4(b)(vi) of this Agreement and shall
also continue benefits to the Executive and/or
the Executive's family at least equal to those
which would have been provided to them in
accordance with the plans, programs, practices
and policies described in Section 4(b)(iv) of
this Agreement if the Executive's employment
had not been terminated in accordance with
the most favorable plans, practices, programs
or policies of the Company and its affiliated
companies applicable generally to other peer
executives and their families during the 90-day
period immediately preceding the Effective
Date or, if more favorable to the Executive, as
in effect generally with respect to other peer
executives of the Company and its affiliated
companies and their families at any time
thereafter, provided, however, that if the
Executive becomes reemployed with another
employer, all such benefits shall terminate
upon such employment. Notwithstanding the
foregoing, when the Company's obligations to
provide benefits under this paragraph
terminate, the Executive will have the right to
continue such benefits at his own expense for
eighteen months. The Executive shall notify
the Company promptly upon his acceptance of
new employment. The Executive shall notify
the Company promptly upon his acceptance of
new employment. For purposes of determining
eligibility of the Executive for retiree benefits
pursuant to such plans, practices, programs
and policies, the Executive shall be considered
to have remained employed until the end of the
Employment Period and to have retired on the
last day of such period; and
(iii) to the extent not theretofore paid
or provided, subject to Section 9(a)(i) of this
Agreement, the Company shall timely pay or
provide to the Executive, his estate or his
beneficiary, as applicable, any other amounts
or benefits required to be paid or provided or
which the Executive, his estate or his
beneficiary, as applicable, is eligible to receive
pursuant to this Agreement and any plan,
program, policy or practice or contract or
agreement of the Company and its affiliated
companies (such other amounts and benefits
shall be hereinafter referred to as the "Other
Benefits"); and
(iv) if the Executive's employment is
terminated by reason of the Executive's death
during the Employment Period, anything in this
Agreement to the contrary notwithstanding, the
Executive's family shall be entitled to receive
benefits at least equal to the most favorable
benefits provided by the Company and any of
its affiliated companies to surviving families of
peer executives of the Company and such
affiliated companies under such plans,
programs, practices and policies relating to
family death benefits, if any, as in effect with
respect to other peer executives and their
families at any time during the 90-day period
immediately preceding the Effective Date or, if
more favorable to the Executive and/or the
Executive's family, as in effect on the date of
the Executive's death with respect to other
peer executives of the Company and its
affiliated companies and their families; and
(v) if the Executive's employment is
terminated by reason of the Executive's
Disability during the Employment Period,
anything in this Agreement to the contrary
notwithstanding, the Executive shall be entitled
after the Disability Effective Date to receive
disability and other benefits at least equal to
the most favorable to those generally provided
by the Company and its affiliated companies to
disabled executives and/or their families in
accordance with such plans, programs,
practices and policies relating to disability, if
any, as in effect generally with respect to other
peer executives and their families at any time
during the 90-day period immediately
preceding the Effective Date or, if more
favorable to the Executive and/or the
Executive's family, as in effect at any time
thereafter generally with respect to other peer
executives of the Company and its affiliated
companies and their families.
(b) Cause; Other than for Good Reason. If
the Executive's employment shall be terminated for
Cause during the Employment Period, this Agreement
shall terminate without further obligations to the
Executive other than the obligation to pay to the
Executive Annual Base Salary through the Date of
Termination plus the amount of any compensation
previously deferred by the Executive, if each case to
the extent theretofore unpaid, and the timely payment
or provision of Other Benefits. If the Executive
terminates employment during the Employment
Period, excluding a termination for Good Reason, this
Agreement shall terminate without further obligations
to the Executive, other than for Accrued Obligations
and the timely payment or provision of Other Benefits;
in such case, all Accrued Obligations shall be paid to
the Executive in a lump sum in cash within 30 days of
the Date of Termination.
(c) Termination Following the Expiration of
the Employment Period. If the Executive's
employment shall be terminated by the Company
without Cause during the one-year period following
the expiration of the Employment Period, for the
remainder of such one-year period, or such longer
period as any plan, program, practice or policy may
provide, the Company shall continue benefits to the
Executive and/or the Executive's family at least equal
to those which would have been provided to them in
accordance with the plans, programs, practices and
policies described in Section 4(b)(iv) of this
Agreement if the Executive's employment had not
been terminated in accordance with the most
favorable plans, practices, programs or policies of the
Company and its affiliated companies applicable
generally to other peer executives and their families
during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive,
as in effect generally with respect to other peer
executives of the Company and its affiliated
companies and their families at any time thereafter,
provided, however, that if the Executive becomes
reemployed with another employer, all such benefits
shall terminate upon such employment.
Notwithstanding the foregoing, when the Company's
obligations to provide benefits under this paragraph
terminate, the Executive will have the right to continue
such benefits at his own expense for eighteen
months.
7. Non-Exclusivity of Rights. Except as
provided in Sections 6(a)(i)(B), 6(a)(ii) and 12(f) of
this Agreement, nothing in this Agreement shall
prevent or limit the Executive's continuing or future
participation in any plan, program, policy or practice
provided by the Company or any of its affiliated
companies and for which the Executive may qualify,
nor shall anything herein limit or otherwise affect such
rights as the Executive may have under any contract
or agreement with the Company or any of its affiliated
companies. Amounts which are vested benefits or
which the Executive is otherwise entitled to receive
under any plan, policy, practice or program of or any
contract or agreement with the Company or any of its
affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such
plan, policy, practice or program or contract or
agreement except as explicitly modified by this
Agreement.
8. Full Settlement. The Company's
obligation to make the payments provided for in this
Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim,
right or action which the Company may have against
the Executive or others. In no event shall the
Executive be obligated to seek other employment or
take any other action by way of mitigation of the
amounts payable to the Executive under any of the
provisions of this Agreement and, except as provided
in Section 6(a)(ii) of this Agreement, such amounts
shall not be reduced whether or not the Executive
obtains other employment. The Company agrees to
pay, to the full extent permitted by law, all legal fees
and expenses which the Executive may reasonably
incur as a result of any contest (regardless of the
outcome thereof) by the Company, the Executive or
others of the validity or enforceability of, or liability
under, any provision of this Agreement or any
guarantee of performance thereof (including as a
result of any contest by the Executive about the
amount of any payment pursuant to his Agreement),
plus in each case interest on any delayed payment at
the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Internal Revenue Code of 1986,
as amended (the "Code").
9. Certain Reductions in the Payment by
the Company.
(a) Anything in this Agreement to the
contrary notwithstanding, in the event it shall be
determined that any payment or distribution by the
Company to or for the Employee's benefit (whether
paid or payable or distributed or distributed pursuant
to the terms of this Agreement or otherwise) (a
"Payment") would be nondeductible by the Company
for Federal income tax purposes because of Section
280G of the Code, then the aggregate present value
of amounts payable or distributable to or for the
Executive's benefit pursuant to this Agreement (such
payments or distributions pursuant to this Agreement
are hereinafter referred to as "Agreement Payments")
shall be reduced (but not below zero) to the Reduced
Amount. The "Reduced Amount" shall be the greater
of (i) the highest aggregate present value of
Agreement Payments that can be paid without
causing any payments or benefits hereunder to be an
Excess Parachute Payment or (ii) the largest portion,
up to and including the total, of the Agreement
Payments that after taking into account all applicable
state and Federal taxes (computed at the highest
applicable marginal rate) including any taxes payable
pursuant to Section 4999 of the Code, results in a
greater after-tax benefit to the Executive than the
after-tax benefit to the Executive of the amount
calculated under (i) hereof (computed at the highest
applicable marginal rate). For purposes of this
Section 9, present value shall be determined in
accordance with Section 280G(d)(4) of the Code.
(b) Subject to the provisions of Section 9(c),
all determinations required to be made under this
Section 9 shall be made by the Company's
independent accountants (the "Accounting Firm")
which shall provide detailed supporting calculations
both to the Company and the Executive within 15
business days of the receipt of notice from the
Executive that there has been a Payment, or such
earlier time as is requested by the Company. In the
event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the Executive
and the Company shall mutually appoint another
accounting firm to make the determinations required
hereunder. All fees and expenses of the Accounting
Firm shall be borne solely by the Company. If the
Accounting Firm determines that no Excise Tax is
payable by the Executive, it shall furnish the
Executive with a written opinion that failure to report
the Excise Tax on the Executive's applicable federal
income tax return would not result in the imposition of
a negligence or similar penalty. Any determination by
the Accounting Firm shall be binding upon the
Company and the Executive. If the Accounting Firm
determines that a reduction pursuant to Section 9(a)
is necessary, the Employee shall determine which
and how much of the Agreement Payments (or, at the
election of the Employee, other payments) shall be
eliminated or reduced consistent with the
requirements of this Section 9, provided that, if the
Employee does not make such determination within
ten business days of the receipt of the calculations
made by the Accounting Firm the Company shall
elect which and how much of the Agreement
Payments shall be eliminated or reduced consistent
with the Requirements of this Section 9 and shall
notify the Employee promptly of such election. Within
five business days thereafter, the Company shall pay
the Employee or distribute to or for the Employee's
benefit such amounts as are then due to the
Employee under this Agreement.
(c) As a result of the uncertainty in the
application of Section 280G of the Code at the time of
the initial determination by the Accounting Firm
hereunder, it is possible that Agreement Payments
will have been made by the Company which should
not have been made ("Overpayment") or that
additional Agreement Payments which will have not
been made by the Company could have been made
("Underpayment"), in each case, consistent with the
calculations required to be made hereunder. In the
event that the Accounting Firm determines that an
Overpayment has been made, any such
Overpayment shall be treated for all purposes as a
loan to the Employee which the Employee shall repay
to the Company together with interest at the
applicable Federal rate provided for in Section
7872(f)(2) of the Code. In the event that the
Accounting Firm determines that an Underpayment
has occurred, any such Underpayment shall be
promptly paid by the Company to or for the benefit of
the Employee together with interest at the applicable
Federal rate provided for in Section 7872(f)(2) of the
Code.
10. Confidential Information. The Executive
shall hold in a fiduciary capacity for the benefit of the
Company all secret or confidential information,
knowledge or data relating to the Company or any of
its affiliated companies, and their respective
businesses, which shall have been obtained by the
Executive during the Executive's employment by the
Company or any of its affiliated companies and which
shall not be or become public knowledge (other than
by acts by the Executive or representatives of the
Executive in violation of this Agreement). After
termination of the Executive's employment with the
Company, the Executive shall not, without the prior
written consent of the Company or as may otherwise
be required by law or legal process, communicate or
divulge any such information, knowledge or data to
anyone other than the Company and those
designated by it. In no event shall an asserted
violation of the provisions of this Section 10 constitute
a basis for deferring or withholding any amounts
otherwise payable to the Executive under this
Agreement.
11. Successors. (a) This Agreement is
personal to the Executive and without the prior written
consent of the Company shall not be assignable by
the Executive otherwise than by will or the laws of
descent and distribution. This Agreement shall inure
to the benefit of an be enforceable by the Executive's
legal representative.
(b) This Agreement shall inure to the
benefit of and be binding upon the Company and its
successors and assigns.
(c) The Company will require any
successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the
Company to assume expressly and agree to perform
this Agreement in the same manner and to the same
extent that the Company would be required to
perform it if no such succession had taken place. As
used in this Agreement, "Company" shall mean the
Company as hereinbefore defined and any successor
to its business and/or assets as aforesaid which
assumes and agrees to perform this Agreement by
operation of law, or otherwise.
12. Miscellaneous.
(a) This Agreement shall be governed by
and construed in accordance with the laws of the
State of Mississippi without reference to principles of
conflict of laws. The captions of this Agreement are
not part of the provisions hereof and shall have no
force or effect. This Agreement may not be amended
or modified otherwise than by a written agreement
executed by the parties hereto or their respective
successors and legal representative.
(b) All notices and other communications
hereunder shall be in writing and shall be given by
hand delivery to the other party or by registered or
certified mail, return receipt requested, postage
prepaid, addressed as follows:
If to the Executive:
At the home address reflected in the
Company's personnel records.
If to the Company:
Jitney-Jungle Stores of America, Inc.
1770 Ellis Avenue, Suite 200
Jackson, MS 39204
Attention: Chief Executive Officer
or to such other address as either party shall have
furnished to the other in writing in accordance
herewith. Notice and communications shall be
effective when actually received by the addressee.
(c) The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity
or enforceability of any other provision of this
Agreement.
(d) The Company may withhold from any
amounts payable under this Agreement such Federal,
state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
(e) The Executive's or the Company's
failure to insist upon strict compliance with any
provision hereof or any other provision of this
Agreement or the failure to asset any right the
Executive or the Company may have hereunder,
including, without limitation, the right of the Executive
to terminate employment for Good Reason pursuant
to Section 5(c)(i)-(v) of this Agreement, shall not be
deemed to be a waiver of such provision or right or
any other provision or right of this Agreement.
(f) The Executive and the Company
acknowledge that, except as may otherwise be
provided under any other written employment
agreement between the Executive and the Company,
the employment of the Executive by the Company is
"at will" and, prior to the Effective Date, may be
terminated by either the Executive or the Company at
any time. Moreover, if prior to the Effective Date the
Executive's employment with the Company
terminates, then the Executive shall have no further
rights under this Agreement. If the Executive has a
written employment agreement with the Company,
that agreement shall be superseded by this
Agreement upon a Change of Control; provided, that
the salary, bonus, incentive, savings, retirement,
welfare benefits, expense reimbursement, fringe
benefits, office and support staff and vacation
provisions, if any, of such agreement shall provide the
applicable measure of compensation provided to the
Executive by the Company and its affiliated
companies prior to the Change of Control for
purposes of this Agreement (unless the Company and
its affiliated companies in fact provided compensation
higher than the compensation required to be provided
under the agreement, in which case the higher
amount or benefit shall apply), but provided further,
however, that any provisions with respect to
severance benefits in such agreement shall no longer
be applicable and shall be replaced by the benefits
provided under this Agreement.
IN WITNESS WHEREOF, the Executive
has hereunto set the Executive's hand and, pursuant
to the authorization from its Board of Directors, the
Company has caused these presents to be executed
in its name on its behalf, all as of the day and year
first above written.
EXECUTIVE:
Name: Ronald E. Johnson
JITNEY-JUNGLE STORES OF AMERICA,
INC.:
By:
Name:
Title:
CHANGE OF CONTROL AGREEMENT
AGREEMENT by and between Jitney-Jungle
Stores of America, Inc., a Mississippi corporation (the
"Company") and R. Barry Cannada (the "Executive"),
dated as of the ____ day of ____________, 1999.
The Board of Directors of the Company (the
"Board"), has determined that it is in the best interest
of the Company and its shareholders to assure that
the Company will have the continued dedication of
the Executive, notwithstanding the possibility, threat
or occurrence of a Change of Control (as defined
below) of the Company. The Board believes it is
imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and
risks created by a pending or threatened Change of
Control and to encourage the Executive's full
attention and dedication to the Company currently
and in the event of any threatened or pending
Change of Control, and to provide the Executive with
compensation and benefits arrangements upon a
Change of Control which ensure that the
compensation and benefits expectations of the
Executive will be satisfied and which are competitive
with those of other corporations. Therefore, in order
to accomplish these objectives, the Board has caused
the Company to enter into this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Certain Definitions.
(a) The "Effective Date" shall mean the first
date during the Change of Control Period (as defined
in Section 1(b) on which a Change of Control (as
defined in Section 2) occurs. Anything in this
Agreement to the contrary notwithstanding, if a
Change of Control occurs and if the Executive's
employment with the Company is terminated prior to
the date on which the Change of Control occurs, and
if it is reasonably demonstrated by the Executive that
such termination of employment (i) was at the request
of a third party who has taken steps reasonably
calculated to effect the Change of Control or (ii)
otherwise arose in connection with or anticipation of
the Change of Control, then for all purposes of this
Agreement the "Effective Date" shall mean the date
immediately prior to the date of such termination of
employment.
(b) The "Change of Control Period" shall
mean the period commencing on the date hereof and
ending on the third anniversary of such date;
provided, however, that commencing on the date one
year after the date hereof, and on each annual
anniversary of such date (such date and each
anniversary thereof shall be hereinafter referred to as
the "Renewal Date"), the Change of Control Period
shall be automatically extended so as to terminate
three years from such Renewal Date, unless at least
60 days prior to the Renewal Date the Company shall
give notice to the Executive that the change of
Control Period shall not be so extended.
2. Change of Control. For the purposes of
this Agreement, a "Change of Control" shall mean:
(a) The acquisition by any individual, entity,
or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) of beneficial
ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 20% or
more of either (i) the then outstanding shares of
common stock of the Company (the "Outstanding
Company Common Stock") or (ii) the combined voting
power of the then outstanding voting securities of the
Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting
Securities"); provided, however, that the following
acquisitions shall not constitute a Change of Control:
(i) any acquisition directly from the Company, unless
such acquisition causes an individual, entity or group
(other than Bruckmann, Rosser, Sherrill & Co., L.P.)
to beneficially own more than 50% of either the
Outstanding Company Common Stock or the
Outstanding Company Voting Securities, (ii) any
acquisition by the Company or any of its subsidiaries,
(iii) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the
Company or any of its subsidiaries, (iv) any
acquisition by any corporation with respect to which,
following such acquisition, more than 60% of,
respectively, the then outstanding shares of common
stock of such corporation and the combined voting
power of the then outstanding voting securities of
such corporation entitled to vote generally in the
election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company
Common Stock and Company Voting Securities
immediately prior to such acquisition in substantially
the same proportions as their ownership, immediately
prior to such acquisition, of the Outstanding Company
Common Stock and outstanding Company Voting
Securities, as the case may be, (v) any acquisition by
an underwriter or dealer in connection with a public
offering registered under the Securities Act of 1933,
as amended; or (vi) any acquisition of the Company's
common stock from underwriters or dealers in an
initial public offering registered under the Securities
Act of 1933, as amended; provided further, however,
that if and for so long as Bruckmann, Rosser, Sherrill
& Co., L.P. beneficially owns more of both
Outstanding Company Common Stock and
Outstanding Company Voting Securities than the
acquiring individual, entity or group, a Change of
Control shall not have occurred. Shareholders party
to shareholders agreements in effect on the date of
this Agreement shall not be considered a group for
purposes of this Agreement solely as a result of such
agreements or as a result of such shareholders voting
in accordance with the terms of such agreements. In
addition, it is specifically acknowledged that, as long
as Bruckmann, Rosser, Sherrill & Co., L.P.
beneficially owns 20% or more of the Outstanding
Company Common Stock or Outstanding Company
Voting Securities, a Change of control shall not occur
solely as a result of the acquisition of additional
shares of Outstanding Company Common Stock or
Outstanding Company Voting Securities by (x)
Bruckmann, Rosser, Sherrill & Co., L.P. or (y) the
manager of Bruckmann, Rosser, Sherrill & Co., L.P.,
BRS Partners, Limited Partnership, BRSE
Associates, Inc., Bruce C. Bruckmann, Harold O.
Rosser II, Stephen C. Sherrill, Stephen F. Edwards or
Paul D. Kaminski, as long as such individual or entity
in this clause (y) does not after such acquisition
beneficially own 20% or more of such securities when
considered alone or as a part of any group of which
Bruckmann, Rosser, Sherrill & Co., L.P. is not a
member.
(b) A development whereby the individuals
who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute
at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to
the date hereof whose election, or nomination for
election by the Company's shareholders, was
approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall
be considered member of the Incumbent Board, but
excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of either
an actual or threatened election contest (such as
terms are used in Rule 14a-11 of Regulation 14A
promulgate under the Exchange Act) or other actual
or threatened solicitation of proxies or consents; or
(c) Consummation by the Company of a
reorganization, merger or consolidation, in each case,
with respect to which all or substantially all of the
individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting
Securities immediately prior to such reorganization,
merger or consolidation do not, following such
reorganization, merger or consolidation, beneficially
own, directly or indirectly, more than 60% of,
respectively, then outstanding shares of common
stock and the combined voting power of the then
outstanding voting securities entitled to vote generally
in the election of directors, as the case may be, of the
corporation resulting from such reorganization,
merger or consolidation in substantially the same
proportions as their ownership, immediately prior to
such reorganization, merger or consolidation of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case
may be; or
(d) (i) Approval by the shareholders of the
Company of a complete liquidation or dissolution of
the Company or (ii) consummation of the sale or
disposition of all or substantially all of the assets of
the Company, other than to a corporation, with
respect to which following such sale or other
disposition, more than 60% of, respectively, the then
outstanding shares of common stock of such
corporation and the combined voting power of the
then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who
were the beneficial owners, respectively, of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately
prior to such sale or other disposition in substantially
the same proportion as their ownership, immediately
prior to such sale or other disposition, of the
Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case
may be.
3. Employment Period. The Company
hereby agrees to continue the Executive in its
employ, and the Executive hereby agrees to remain in
the employ of the Company, for the period
commencing on the Effective Date and ending on the
second anniversary of such date (the "Employment
Period").
4. Terms of Employment.
(a) Position and Duties.
(i) During the Employment Period,
(A) the Executive's position (including status,
officers, titles and reporting requirements),
authority, duties and responsibilities shall be at
least commensurate in all material respects
with the most significant of those held,
exercised and assigned at a time during the
90-day period immediately preceding the
Effective Date and (B) the Executive's services
shall be performed at the location where the
Executive was employed immediately
preceding the Effective Date or any office or
location less than 35 miles from such location.
(ii) During the Employment Period,
and excluding any periods of sick leave to
which the Executive is entitled, the Executive
agrees to devote reasonable attention and
time during normal business hours to the
business and affairs of the Company and, to
the extent necessary to discharge the
responsibilities assigned to the Executive
hereunder, to use the Executive's reasonable
best efforts to perform faithfully and efficiently
such responsibilities. During the Employment
Period it shall not be a violation of this
Agreement for the Executive to (A) serve on
corporate, civic or charitable boards or
committees, (B) deliver lectures, fulfill speaking
engagements or teach at educational
institutions and (C) manage personal
investments, so long as such activities do not
significantly interfere with the performance of
the Executive's responsibilities as an employee
of the Company in accordance with this
Agreement. It is expressly understood and
agreed that to the extent that any such
activities have been conducted by the
Executive prior to the Effective Date, the
continued conduct of such activities (or the
conduct of activities similar in nature and
scope thereto) subsequent to the Effective
Date shall not thereafter be deemed to
interfere with the performance of the
Executive's responsibilities to the Company.
(b) Compensation.
(i) Base Salary. During the
Employment Period, the Executive shall
receive an annual base salary, payable in
equal monthly installments, at least equal to
twelve times the highest monthly base salary
paid or payable to the Executive by the
Company and its affiliated companies during
the twelve month period immediately preceding
the month in which the Effective Date occurs
("Annual Base Salary"). As used in this
Agreement, the term "affiliated companies"
shall include any company controlled by,
controlling or under common control with the
Company.
(ii) Annual Bonus. In addition to
Annual Base Salary, the Executive shall be
awarded, for each fiscal year ending during the
Employment Period, an annual bonus (the
"Annual Bonus") in cash at least equal to the
average annual bonus paid or payable to the
Executive by the Company and its affiliated
companies in respect of the three fiscal years
(annualized for any fiscal year consisting of
less than twelve full months or with respect to
which the Executive has been employed by the
Company for less than twelve full months)
immediately preceding the fiscal year in which
the Effective Date occurs (the "Recent Average
Bonus"). Such annual Bonus shall be paid no
later than the third month of the fiscal year next
following the fiscal year for which the annual
Bonus is awarded, unless the Executive shall
elect to defer the receipt of such Annual
Bonus.
(iii) Incentive, Savings and
Retirement Plans. During the Employment
Period, the Executive shall be entitled to
participate in all incentive, savings and
retirement plans, practices, policies and
programs applicable generally to other peer
executives of the Company and its affiliated
companies, but in no event shall such plans,
practices, policies and programs provide the
Executive with incentive opportunities
(measured with respect to both regular and
special incentive opportunities, to the extent, if
any, that such distinction is applicable),
savings opportunities and retirement benefit
opportunities, in each case, less favorable, in
the aggregate, than the most favorable of
those provided by the Company and its
affiliated companies for the Executive under
such plans, practices, policies and programs
as in effect at any time during the 90-day
period immediately preceding the Effective
Date, or, if more favorable to the Executive,
those provided generally to other peer
executives of the company and its affiliated
companies at any time after the Effective Date.
(iv) Welfare Benefit Plans. During
the Employment Period and for a period of one
year thereafter, provided the Executive
remains employed by the Company, the
Executive and/or the Executive's family, as the
case may be shall be eligible for participation
in and shall receive all benefits under welfare
benefit plans, practices, policies and programs
provided by the Company and its affiliated
companies (including, without limitation,
medical, prescription, dental, disability, salary,
continuance, employee life, group life,
accidental death and travel accident insurance
plans and programs) to the extent applicable
generally to other peer executives of the
Company and its affiliated companies, but in
no event shall such plans, practices, policies
and programs provide the Executive with
benefits which are less favorable, in the
aggregate, than the most favorable of such
plans, practices, policies and programs in
effect for the Executive at any time during the
90-day period immediately preceding the
Effective Date or if more favorable to the
Executive, those provided generally to other
peer executives of the Company and its
affiliated companies at any time after the
Effective Date.
(v) Expenses. During the
Employment Period, the Executive shall be
entitled to receive prompt reimbursement for all
reasonable expenses incurred by the
Executive in accordance with the most
favorable policies, practices and procedures of
the Company and its affiliated companies in
effect for the Executive at any time during the
90-day period immediately preceding the
Effective Date or, if more favorable to the
Executive, as in effect generally with respect to
other peer executives of the Company and its
affiliated companies at any time thereafter.
(vi) Fringe Benefits. During the
Employment Period, the Executive shall be
entitled to fringe benefits in accordance with
the most favorable plans, practices, programs
and policies of the Company and its affiliated
companies in effect for the Executive at any
time during the 90-day period immediately
preceding the Effective Date or, if more
favorable to the Executive, as in effect
generally with respect to other peer executives
of the Company and its affiliated companies at
any time thereafter.
(vii) Office and Support Staff. During
the Employment Period, the Executive shall be
entitled to an office or offices of a size and with
furnishings and other appointments, and to
secretarial and other assistance, at least equal
to the most favorable of the foregoing provided
to the Executive by the Company and its
affiliated companies at any time during the 90-
day period immediately preceding the Effective
Date or, if more favorable to the Executive, as
provided generally with respect to other peer
executives of the Company and its affiliated
companies at any time thereafter.
(viii) Vacation. During the Employment
Period, the Executive shall be entitled to paid
vacation in accordance with the most favorable
plans, policies and practices of the Company
and its affiliated companies in effect for the
Executive at any time during the 90-day period
immediately preceding the Effective Date or, if
more favorable to the Executive, as in effect
generally with respect to other peer executives
of the Company and its affiliated companies at
any time thereafter.
5. Termination of Employment.
(a) Death or Disability. The Executive's
employment shall terminate automatically upon the
Executive's death during the Employment Period. If
the Company determines in good faith that the
Disability of the Executive has occurred during the
Employment Period (pursuant to the definition of
Disability set forth below), it may give to the Executive
written notice in accordance with Section 12(b) of this
Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's
employment with the Company shall terminate
effective on the 15th day after receipt of such notice by
the Executive (the "Disability Effective Date"),
provided that, within the 15 days after such receipt,
the Executive shall not have returned to full-time
performance of the Executive's duties. For purposes
of this Agreement, "Disability" shall mean the absence
of the Executive from the Executive's duties with the
Company on a full-time basis for 180 consecutive
business days as a result of incapacity due to mental
or physical illness which is determined to be total and
permanent by a physician selected by the Company
or its insurers and acceptable to the Executive or the
Executive's legal representative (such agreement as
to acceptability not to be withheld unreasonably).
(b) Cause The Company may terminate
the Executive's employment during the Employment
Period for Cause. For purposes of this Agreement,
"Cause" shall mean (i) repeated violations by the
Executive of the Executive's obligations under
Section 4(a) of this Agreement (other than as a result
of incapacity due to physical or mental illness) which
are demonstrably willful and deliberate on the
Executive's part, which are committed in bad faith or
without reasonable belief that such violations are in
the best interest of the Company and which are not
remedied in a reasonable period of time after receipt
of written notice from the Company specifying such
violations or (ii) the conviction of the Executive of a
felony involving moral turpitude.
(c) Good Reason. The Executive's
employment may be terminated during the
Employment Period by the Executive for Good
Reason. For purposes of this Agreement, "Good
Reason" shall mean:
(i) the assignment to the Executive
of any duties inconsistent in any respect with
the Executive's position (including status,
offices, titles and reporting requirements),
authority, duties or responsibilities as
contemplated by Section 4(a) of this
Agreement, or any other action by the
Company which results in a diminution in such
position, authority, duties and responsibilities,
excluding for this purpose an isolated,
insubstantial and inadvertent action not taken
in bad faith and which is remedied by the
Company promptly after receipt of notice
thereof given by the Executive;
(ii) any failure by the Company to
comply with any of the provisions of Section
4(b) of this Agreement, other than an isolated,
insubstantial and inadvertent failure not
occurring in bad faith and which is remedied by
the Company promptly after receipt of notice
thereof given by the Executive;
(iii) the Company's requiring the
Executive to be based at any office or location
other than that described in Section 4(a)(i)(B)
hereof;
(iv) any purported termination by the
Company of the Executive's employment
otherwise than as expressly permitted by this
Agreement; or
(v) any failure by the Company to
comply with and satisfy Section 11(c) of this
Agreement, provided that such successor has
received at least ten days prior written notice
from the Company or the Executive of the
requirements of Section 11(c) of the
Agreement.
For purposes of this Section 5(c), any good faith
determination of "Good Reason" made by the
Executive shall be conclusive.
(d) Notice of Termination. Any termination
by the Company for Cause or by the Executive for
Good Reason, shall be communicated by Notice of
Termination to the other party hereto given in
accordance with Section 12(b) of this Agreement. For
purposes of this Agreement, a "Notice of Termination"
means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon,
(ii) to the extent applicable, 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, and (iii) if the Date of
Termination (as defined below) is other than the date
of receipt of such notice, specifies the termination
date (which date shall be not more than fifteen days
after the giving of such notice). The failure by the
Executive or the Company to set forth in the Notice of
Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause
shall not waive any right of the Executive or the
Company hereunder or preclude the Executive or the
Company from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights
hereunder.
(e) Date of Termination. "Date of
Termination" means (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 any later date specified
therein, as the case may be, (ii) if the Executive's
employment is terminated by the Company other than
for Cause or Disability, the Date of Termination shall
be the date on which the Company notifies the
Executive of such termination, or (iii) if the Executive's
employment is terminated by reason of death or
Disability, the Date of Termination shall be the date of
death of the Executive or the Disability Effective Date,
as the case may be.
6. Obligations of the Company upon Termination.
(a) Good Reason; Death or Disability; Other
Than for Cause. If, during the Employment Period,
the Company shall terminate the Executive's
employment upon the Executive's death or Disability
or other than for Cause, or the Executive shall
terminate employment for Good Reason, then all
obligations of the Company and the Executive under
Section 4 shall terminate as of the Date of
Termination and:
(i) the Company shall pay to the
Executive, his estate or his beneficiary, as
applicable, in a lump sum in cash within 30
days after the Date of Termination the
aggregate of the following amounts (such
aggregate shall be hereinafter referred to as
the "Special Termination Amount"), subject to
Section 9(a)(i) of this Agreement:
(A) the sum of (1) the
Executive's Annual Base Salary through
the Date of Termination to the extent not
theretofore paid, (2) the product of (x)
the "Highest Annual Bonus" which is
equal to the greater of (i) the Annual
Bonus paid or payable to the Executive
(and annualized for any fiscal year
consisting of less than twelve full
months or for which the Executive has
been employed for less than twelve full
months) for the most recently completed
fiscal year during the Employment
Period, if any, and (ii) the Recent
Average Bonus and (y) a fraction, the
numerator of which is the number of
days in the current fiscal year through
the Date of Termination, and the
denominator of which is 365 and (3) any
compensation previously deferred by
the Executive (together with any
accrued interest or earnings thereon)
and any accrued vacation pay, in each
case to the extent not theretofore paid
(the sum of the amounts described in
clauses (1), (2) and (3) shall be
hereinafter referred to as the "Accrued
Obligations"); and
(B) provided that the payment
is approved by the separate vote of the
holders of 75% or more of the voting
power of all outstanding stock of the
Company, the amount equal to the
product of (1) two and (2) the sum of (x)
the Executive's Annual Base Salary and
(y) the Highest Annual Bonus; provided,
however, that such amount shall be paid
in lieu of, and the Executive hereby
waives the right to receive, any other
amount of severance relating to salary
or bonus continuation to be received by
the Executive upon such termination of
employment under any severance plan,
policy or arrangement of the Company;
and
(ii) for the period from the Date of
Termination through the first anniversary of
such date, or such longer period as any plan,
program, practice or policy may provide, the
Company shall continue to provide Executive
an automobile at least in the manner as has
been provided in accordance with the plans,
programs, practices and policies described in
Section 4(b)(vi) of this Agreement and shall
also continue benefits to the Executive and/or
the Executive's family at least equal to those
which would have been provided to them in
accordance with the plans, programs, practices
and policies described in Section 4(b)(iv) of
this Agreement if the Executive's employment
had not been terminated in accordance with
the most favorable plans, practices, programs
or policies of the Company and its affiliated
companies applicable generally to other peer
executives and their families during the 90-day
period immediately preceding the Effective
Date or, if more favorable to the Executive, as
in effect generally with respect to other peer
executives of the Company and its affiliated
companies and their families at any time
thereafter, provided, however, that if the
Executive becomes reemployed with another
employer, all such benefits shall terminate
upon such employment. Notwithstanding the
foregoing, when the Company's obligations to
provide benefits under this paragraph
terminate, the Executive will have the right to
continue such benefits at his own expense for
eighteen months. The Executive shall notify
the Company promptly upon his acceptance of
new employment. The Executive shall notify
the Company promptly upon his acceptance of
new employment. For purposes of determining
eligibility of the Executive for retiree benefits
pursuant to such plans, practices, programs
and policies, the Executive shall be considered
to have remained employed until the end of the
Employment Period and to have retired on the
last day of such period; and
(iii) to the extent not theretofore paid
or provided, subject to Section 9(a)(i) of this
Agreement, the Company shall timely pay or
provide to the Executive, his estate or his
beneficiary, as applicable, any other amounts
or benefits required to be paid or provided or
which the Executive, his estate or his
beneficiary, as applicable, is eligible to receive
pursuant to this Agreement and any plan,
program, policy or practice or contract or
agreement of the Company and its affiliated
companies (such other amounts and benefits
shall be hereinafter referred to as the "Other
Benefits"); and
(iv) if the Executive's employment is
terminated by reason of the Executive's death
during the Employment Period, anything in this
Agreement to the contrary notwithstanding, the
Executive's family shall be entitled to receive
benefits at least equal to the most favorable
benefits provided by the Company and any of
its affiliated companies to surviving families of
peer executives of the Company and such
affiliated companies under such plans,
programs, practices and policies relating to
family death benefits, if any, as in effect with
respect to other peer executives and their
families at any time during the 90-day period
immediately preceding the Effective Date or, if
more favorable to the Executive and/or the
Executive's family, as in effect on the date of
the Executive's death with respect to other
peer executives of the Company and its
affiliated companies and their families; and
(v) if the Executive's employment is
terminated by reason of the Executive's
Disability during the Employment Period,
anything in this Agreement to the contrary
notwithstanding, the Executive shall be entitled
after the Disability Effective Date to receive
disability and other benefits at least equal to
the most favorable to those generally provided
by the Company and its affiliated companies to
disabled executives and/or their families in
accordance with such plans, programs,
practices and policies relating to disability, if
any, as in effect generally with respect to other
peer executives and their families at any time
during the 90-day period immediately
preceding the Effective Date or, if more
favorable to the Executive and/or the
Executive's family, as in effect at any time
thereafter generally with respect to other peer
executives of the Company and its affiliated
companies and their families.
(b) Cause; Other than for Good Reason. If
the Executive's employment shall be terminated for
Cause during the Employment Period, this Agreement
shall terminate without further obligations to the
Executive other than the obligation to pay to the
Executive Annual Base Salary through the Date of
Termination plus the amount of any compensation
previously deferred by the Executive, if each case to
the extent theretofore unpaid, and the timely payment
or provision of Other Benefits. If the Executive
terminates employment during the Employment
Period, excluding a termination for Good Reason, this
Agreement shall terminate without further obligations
to the Executive, other than for Accrued Obligations
and the timely payment or provision of Other Benefits;
in such case, all Accrued Obligations shall be paid to
the Executive in a lump sum in cash within 30 days of
the Date of Termination.
(c) Termination Following the Expiration of
the Employment Period. If the Executive's
employment shall be terminated by the Company
without Cause during the one-year period following
the expiration of the Employment Period, for the
remainder of such one-year period, or such longer
period as any plan, program, practice or policy may
provide, the Company shall continue benefits to the
Executive and/or the Executive's family at least equal
to those which would have been provided to them in
accordance with the plans, programs, practices and
policies described in Section 4(b)(iv) of this
Agreement if the Executive's employment had not
been terminated in accordance with the most
favorable plans, practices, programs or policies of the
Company and its affiliated companies applicable
generally to other peer executives and their families
during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive,
as in effect generally with respect to other peer
executives of the Company and its affiliated
companies and their families at any time thereafter,
provided, however, that if the Executive becomes
reemployed with another employer, all such benefits
shall terminate upon such employment.
Notwithstanding the foregoing, when the Company's
obligations to provide benefits under this paragraph
terminate, the Executive will have the right to continue
such benefits at his own expense for eighteen
months.
7. Non-Exclusivity of Rights. Except as
provided in Sections 6(a)(i)(B), 6(a)(ii) and 12(f) of
this Agreement, nothing in this Agreement shall
prevent or limit the Executive's continuing or future
participation in any plan, program, policy or practice
provided by the Company or any of its affiliated
companies and for which the Executive may qualify,
nor shall anything herein limit or otherwise affect such
rights as the Executive may have under any contract
or agreement with the Company or any of its affiliated
companies. Amounts which are vested benefits or
which the Executive is otherwise entitled to receive
under any plan, policy, practice or program of or any
contract or agreement with the Company or any of its
affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such
plan, policy, practice or program or contract or
agreement except as explicitly modified by this
Agreement.
8. Full Settlement. The Company's
obligation to make the payments provided for in this
Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim,
right or action which the Company may have against
the Executive or others. In no event shall the
Executive be obligated to seek other employment or
take any other action by way of mitigation of the
amounts payable to the Executive under any of the
provisions of this Agreement and, except as provided
in Section 6(a)(ii) of this Agreement, such amounts
shall not be reduced whether or not the Executive
obtains other employment. The Company agrees to
pay, to the full extent permitted by law, all legal fees
and expenses which the Executive may reasonably
incur as a result of any contest (regardless of the
outcome thereof) by the Company, the Executive or
others of the validity or enforceability of, or liability
under, any provision of this Agreement or any
guarantee of performance thereof (including as a
result of any contest by the Executive about the
amount of any payment pursuant to his Agreement),
plus in each case interest on any delayed payment at
the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Internal Revenue Code of 1986,
as amended (the "Code").
9. Certain Reductions in the Payment by the Company.
(a) Anything in this Agreement to the
contrary notwithstanding, in the event it shall be
determined that any payment or distribution by the
Company to or for the Employee's benefit (whether
paid or payable or distributed or distributed pursuant
to the terms of this Agreement or otherwise) (a
"Payment") would be nondeductible by the Company
for Federal income tax purposes because of Section
280G of the Code, then the aggregate present value
of amounts payable or distributable to or for the
Executive's benefit pursuant to this Agreement (such
payments or distributions pursuant to this Agreement
are hereinafter referred to as "Agreement Payments")
shall be reduced (but not below zero) to the Reduced
Amount. The "Reduced Amount" shall be the greater
of (i) the highest aggregate present value of
Agreement Payments that can be paid without
causing any payments or benefits hereunder to be an
Excess Parachute Payment or (ii) the largest portion,
up to and including the total, of the Agreement
Payments that after taking into account all applicable
state and Federal taxes (computed at the highest
applicable marginal rate) including any taxes payable
pursuant to Section 4999 of the Code, results in a
greater after-tax benefit to the Executive than the
after-tax benefit to the Executive of the amount
calculated under (i) hereof (computed at the highest
applicable marginal rate). For purposes of this
Section 9, present value shall be determined in
accordance with Section 280G(d)(4) of the Code.
(b) Subject to the provisions of Section 9(c),
all determinations required to be made under this
Section 9 shall be made by the Company's
independent accountants (the "Accounting Firm")
which shall provide detailed supporting calculations
both to the Company and the Executive within 15
business days of the receipt of notice from the
Executive that there has been a Payment, or such
earlier time as is requested by the Company. In the
event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or
group effecting the Change of Control, the Executive
and the Company shall mutually appoint another
accounting firm to make the determinations required
hereunder. All fees and expenses of the Accounting
Firm shall be borne solely by the Company. If the
Accounting Firm determines that no Excise Tax is
payable by the Executive, it shall furnish the
Executive with a written opinion that failure to report
the Excise Tax on the Executive's applicable federal
income tax return would not result in the imposition of
a negligence or similar penalty. Any determination by
the Accounting Firm shall be binding upon the
Company and the Executive. If the Accounting Firm
determines that a reduction pursuant to Section 9(a)
is necessary, the Employee shall determine which
and how much of the Agreement Payments (or, at the
election of the Employee, other payments) shall be
eliminated or reduced consistent with the
requirements of this Section 9, provided that, if the
Employee does not make such determination within
ten business days of the receipt of the calculations
made by the Accounting Firm the Company shall
elect which and how much of the Agreement
Payments shall be eliminated or reduced consistent
with the Requirements of this Section 9 and shall
notify the Employee promptly of such election. Within
five business days thereafter, the Company shall pay
the Employee or distribute to or for the Employee's
benefit such amounts as are then due to the
Employee under this Agreement.
(c) As a result of the uncertainty in the
application of Section 280G of the Code at the time of
the initial determination by the Accounting Firm
hereunder, it is possible that Agreement Payments
will have been made by the Company which should
not have been made ("Overpayment") or that
additional Agreement Payments which will have not
been made by the Company could have been made
("Underpayment"), in each case, consistent with the
calculations required to be made hereunder. In the
event that the Accounting Firm determines that an
Overpayment has been made, any such
Overpayment shall be treated for all purposes as a
loan to the Employee which the Employee shall repay
to the Company together with interest at the
applicable Federal rate provided for in Section
7872(f)(2) of the Code. In the event that the
Accounting Firm determines that an Underpayment
has occurred, any such Underpayment shall be
promptly paid by the Company to or for the benefit of
the Employee together with interest at the applicable
Federal rate provided for in Section 7872(f)(2) of the
Code.
10. Confidential Information. The Executive
shall hold in a fiduciary capacity for the benefit of the
Company all secret or confidential information,
knowledge or data relating to the Company or any of
its affiliated companies, and their respective
businesses, which shall have been obtained by the
Executive during the Executive's employment by the
Company or any of its affiliated companies and which
shall not be or become public knowledge (other than
by acts by the Executive or representatives of the
Executive in violation of this Agreement). After
termination of the Executive's employment with the
Company, the Executive shall not, without the prior
written consent of the Company or as may otherwise
be required by law or legal process, communicate or
divulge any such information, knowledge or data to
anyone other than the Company and those
designated by it. In no event shall an asserted
violation of the provisions of this Section 10 constitute
a basis for deferring or withholding any amounts
otherwise payable to the Executive under this
Agreement.
11. Successors. (a) This Agreement is
personal to the Executive and without the prior written
consent of the Company shall not be assignable by
the Executive otherwise than by will or the laws of
descent and distribution. This Agreement shall inure
to the benefit of an be enforceable by the Executive's
legal representative.
(b) This Agreement shall inure to the
benefit of and be binding upon the Company and its
successors and assigns.
(c) The Company will require any
successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the
Company to assume expressly and agree to perform
this Agreement in the same manner and to the same
extent that the Company would be required to
perform it if no such succession had taken place. As
used in this Agreement, "Company" shall mean the
Company as hereinbefore defined and any successor
to its business and/or assets as aforesaid which
assumes and agrees to perform this Agreement by
operation of law, or otherwise.
12. Miscellaneous.
(a) This Agreement shall be governed by
and construed in accordance with the laws of the
State of Mississippi without reference to principles of
conflict of laws. The captions of this Agreement are
not part of the provisions hereof and shall have no
force or effect. This Agreement may not be amended
or modified otherwise than by a written agreement
executed by the parties hereto or their respective
successors and legal representative.
(b) All notices and other communications
hereunder shall be in writing and shall be given by
hand delivery to the other party or by registered or
certified mail, return receipt requested, postage
prepaid, addressed as follows:
If to the Executive:
At the home address reflected in the
Company's personnel records.
If to the Company:
Jitney-Jungle Stores of America, Inc.
1770 Ellis Avenue, Suite 200
Jackson, MS 39204
Attention: Chief Executive Officer
or to such other address as either party shall have
furnished to the other in writing in accordance
herewith. Notice and communications shall be
effective when actually received by the addressee.
(c) The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity
or enforceability of any other provision of this
Agreement.
(d) The Company may withhold from any
amounts payable under this Agreement such Federal,
state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
(e) The Executive's or the Company's
failure to insist upon strict compliance with any
provision hereof or any other provision of this
Agreement or the failure to asset any right the
Executive or the Company may have hereunder,
including, without limitation, the right of the Executive
to terminate employment for Good Reason pursuant
to Section 5(c)(i)-(v) of this Agreement, shall not be
deemed to be a waiver of such provision or right or
any other provision or right of this Agreement.
(f) The Executive and the Company
acknowledge that, except as may otherwise be
provided under any other written employment
agreement between the Executive and the Company,
the employment of the Executive by the Company is
"at will" and, prior to the Effective Date, may be
terminated by either the Executive or the Company at
any time. Moreover, if prior to the Effective Date the
Executive's employment with the Company
terminates, then the Executive shall have no further
rights under this Agreement. If the Executive has a
written employment agreement with the Company,
that agreement shall be superseded by this
Agreement upon a Change of Control; provided, that
the salary, bonus, incentive, savings, retirement,
welfare benefits, expense reimbursement, fringe
benefits, office and support staff and vacation
provisions, if any, of such agreement shall provide the
applicable measure of compensation provided to the
Executive by the Company and its affiliated
companies prior to the Change of Control for
purposes of this Agreement (unless the Company and
its affiliated companies in fact provided compensation
higher than the compensation required to be provided
under the agreement, in which case the higher
amount or benefit shall apply), but provided further,
however, that any provisions with respect to
severance benefits in such agreement shall no longer
be applicable and shall be replaced by the benefits
provided under this Agreement.
IN WITNESS WHEREOF, the Executive
has hereunto set the Executive's hand and, pursuant
to the authorization from its Board of Directors, the
Company has caused these presents to be executed
in its name on its behalf, all as of the day and year
first above written.
EXECUTIVE:
Name: R. Barry Cannada
JITNEY-JUNGLE STORES OF AMERICA,
INC.:
By:
Name:
Title: