EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT, dated as of May 4, 2005, by and between GAYLORD
ENTERTAINMENT COMPANY, a Delaware corporation having its corporate headquarters
at One Gaylord Drive, Nashville, Tennessee 37214 ("the Company") and DAVID C.
KLOEPPEL, a resident of Nashville, Tennessee ("Executive").
WITNESSETH:
WHEREAS, the Company desires to employ Executive as its Executive Vice
President and Chief Financial Officer, and Executive desires to serve in such
capacity pursuant to the terms of this Agreement;
NOW, THEREFORE, in consideration of the covenants and agreements
hereinafter set forth, the parties hereto agree as follows:
AGREEMENT
1. EMPLOYMENT; TERM; PLACE OF EMPLOYMENT. The Company hereby employs
Executive, and Executive hereby accepts employment with the Company upon the
terms and conditions contained in this Agreement. The term of Executive's
employment hereunder shall commence on May 4, 2005 (the "Effective Date") and
shall continue for a period of four (4) years from and after the Effective Date
(the "Employment Period"). For purposes of this Agreement, a "Contract Year"
shall mean a one year period commencing on the Effective Date or any anniversary
thereof. Executive shall render services at the offices established by the
Company in the greater Nashville metropolitan area; provided that Executive
agrees to travel on temporary trips to such other places as may be required to
perform Executive's duties hereunder.
2. DUTIES; TITLE.
(a) Description of Duties.
(i) During the Employment Period, Executive shall
serve the Company as its Executive Vice President and Chief
Financial Officer and report directly to the President and
Chief Executive Officer ("CEO"). Executive shall supervise the
financial conduct of the business and affairs of the Company,
its subsidiaries and respective divisions, supervise the
development function for the Company, and perform such other
duties as the CEO shall determine.
(ii) Executive shall faithfully perform the duties
required of his office. Subject to Section 2(b), Executive
shall devote all of his business time and effort to the
performance of his duties to the Company.
(b) Other Activities. Notwithstanding anything to the contrary
contained in Section 2(a), Executive shall be permitted to engage in
the following activities, provided that such activities do not
materially interfere or conflict with Executive's duties and
responsibilities to the Company:
(i) Executive may serve on the governing boards of,
or otherwise participate in, a reasonable number of trade
associations and charitable organizations,
whose purposes are not inconsistent with the activities and
the image of the Company;
(ii) Executive may engage in a reasonable amount of
charitable activities and community affairs; and
(iii) Subject to the prior approval of the Board of
Directors, Executive may serve on the board of directors of
one or more business corporations, provided also that they do
not compete, directly or indirectly, with the Company.
(c) Other Policies. Executive shall be subject to and shall
comply with all codes of conduct, personnel policies and procedures
applicable to senior executives of the Company, including, without
limitation, policies regarding sexual harassment, conflicts of interest
and insider trading.
3. CASH COMPENSATION.
(a) Base Salary. During the initial Contract Year, the Company
shall pay to Executive an annual salary of $475,000. Executive's annual
salary shall be increased in each subsequent Contract Year by a
percentage equal to the annual percentage increase, if any, generally
granted to other senior executives, such percentage to be determined
from time to time by the Human Resources Committee of the Board of
Directors (such annual salary, together with any increases under this
subsection (b), being herein referred to as the "Base Salary").
(b) Annual Cash Bonus. Executive shall be eligible for an
annual cash bonus equal to a target of 75% of Executive's Base Salary
(the "Year-End Bonus") to be paid to him in each calendar year and
shall be determined based on the achievement of certain goals and
Company performance criteria as established by the CEO and approved by
the Board's Human Resources Committee. The Year-End Bonus for each
calendar year shall be paid to Executive on or before the end of
February 28th of the immediately succeeding year.
(c) Withholding. The Base Salary and each Year-End Bonus shall
be subject to applicable withholding and shall be payable in accordance
with the Company's payroll practices.
4. RESTRICTED STOCK GRANT. The Company hereby grants to Executive
16,000 restricted shares of Company Common Stock (the "Restricted Stock Grant").
The restrictions on the Restricted Stock Grant shares shall terminate in 4,000
share increments on the first through the fourth anniversaries of August 1,
2005; provided, however, Executive must be employed by the Company on each such
anniversary date for the restrictions on the particular share increment to be
terminated. The Restricted Stock Grant is hereby granted pursuant to the
Company's Omnibus Plan as may hereafter be further amended, and shall otherwise
be subject to the terms of a restricted stock grant agreement between the
Company and Executive in the form prescribed for Company executives generally.
If a restriction terminates as to a 4,000 share increment, the Company shall
deliver such shares to Executive.
5. BENEFITS; EXPENSES; ETC.
(a) Expenses. During the Employment Period, the Company shall
reimburse Executive, in accordance with the Company's policies and
procedures, for all reasonable
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expenses incurred by Executive, including reimbursement for his
reasonable first class travel expenses in connection with the
performance of his duties for the Company.
(b) Vehicle Allowance. During the Employment Period, Executive
shall be entitled to receive from the Company a vehicle allowance of
$800 per month, subject to future increases as may be granted to senior
executives.
(c) Vacation. During the Employment Period, Executive shall be
entitled to four (4) weeks vacation during each Contract Year.
(d) Company Plans. During the Employment Period, Executive
shall be entitled to participate in and enjoy the benefits of (i) the
Company Health Insurance Plan, (ii) the Company 401(k) Savings Plan,
(iii) the Company Supplemental Deferred Compensation ("SUDCOMP") Plan,
and (iv) any health, life, disability, retirement, pension, group
insurance, or other similar plan or plans which may be in effect or
instituted by the Company for the benefit of senior executives
generally, upon such terms as may be therein provided. A summary of
such benefits as in effect on the date hereof has been provided to
Executive, the receipt of which is hereby acknowledged.
(e) Attorney's Fees. Executive shall be entitled to
reimbursement for reasonable attorney's fees and expenses incurred by
Executive in the review and negotiation of this Agreement, upon
submission of documentation evidencing such fees and expenses.
6. TERMINATION. Executive's employment hereunder may be terminated
prior to the expiration of the Employment Period as follows:
(a) Termination by Death. Upon the death of Executive
("Death"), Executive's employment shall automatically terminate as of
the date of Death.
(b) Termination by Company for Permanent Disability. At the
option of the Company, Executive's employment may be terminated by
written notice to Executive or his personal representative in the event
of the Permanent Disability of Executive. As used herein, the term
"Permanent Disability" shall mean a physical or mental incapacity or
disability which renders Executive unable substantially to render the
services required hereunder for a period of ninety (90) consecutive
days or one hundred eighty (180) days during any twelve (12) month
period as determined in good faith by the Company.
(c) Termination by Company for Cause. At the option of the
Company, Executive's employment may be terminated by written notice to
Executive upon the occurrence of any one or more of the following
events (each, a "Cause"):
(i) any action by Executive constituting fraud,
self-dealing, embezzlement, or dishonesty in the course of his
employment hereunder;
(ii) any conviction of Executive of a crime involving
moral turpitude;
(iii) failure of Executive after reasonable notice
promptly to comply with any valid and legal directive of the
CEO;
(iv) a material breach by Executive of any of his
obligations under this Agreement and failure to cure such
breach within ten (10) days of his receipt of written notice
thereof from the Company; or
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(v) a failure by Executive to perform adequately his
responsibilities under this Agreement as demonstrated by
objective and verifiable evidence showing that the business
operations under Executive's control have been materially
harmed as a result of Executive's gross negligence or willful
misconduct.
(d) Termination by Executive for Good Reason. At the option of
Executive, Executive may terminate his employment by written notice to
Company given within a reasonable time after the occurrence of the
following circumstances ("Good Reason"), unless the Company cures the
same within thirty (30) days of such notice:
(i) Any adverse change by Company in the Executive's
position or title described in Section 2 hereof, whether or
not any such change has been approved by a majority of the
members of the Board;
(ii) The assignment to Executive, over his reasonable
objection, of any duties materially inconsistent with his
status as Executive Vice President and Chief Financial Officer
or a substantial adverse alteration in the nature of his
responsibilities;
(iii) A reduction by Company in his annual base
salary of $475,000 as the same may be increased from time to
time pursuant to Section 3(b) hereof;
(iv) Company's requiring Executive to be based
anywhere other than the Company's headquarters in Nashville,
Tennessee except for required travel on the Company's
business;
(v) The failure by Company, without Executive's
consent, to pay to him any portion of his current
compensation, except pursuant to this Agreement or pursuant to
a compensation deferral elected by Executive;
(vi) Except as permitted by this Agreement, the
failure by Company to continue in effect any compensation plan
(or substitute or alternative plan) in which Executive is
entitled to participate which is material to Executive's total
compensation, or the failure by the Company to continue
Executive's participation therein on a basis that is
materially as favorable both in terms of the amount of
benefits provided and the level of Executive's participation
relative to other participants at Executive's grade level; or
(vii) The failure by Company to continue to provide
Executive with benefits substantially similar to those enjoyed
by senior executives under the Company's pension and deferred
compensation plans, and the life insurance, medical, health
and accident, and disability plans in which Executive is
entitled to participate, except as required by law, or the
taking of any action by the Company which would directly or
indirectly materially reduce any of such benefits or deprive
Executive of any material fringe benefit enjoyed by Executive,
or the failure by the Company to provide Executive with the
number of paid vacation days to which Executive is entitled;
or
(viii) A material breach by the Company of any of its
obligations under this Agreement.
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(e) Termination by Company Without Cause. At the option of the
Company Executive's employment may be terminated by written notice to
Executive at any time ("Without Cause").
7. EFFECT OF TERMINATION.
(a) Effect Generally. If Executive's employment is terminated
prior to the fourth anniversary of the Effective Date, the Company
shall not have any liability or obligation to Executive other than as
specifically set forth in Section 6, Section 7 and Section 8 hereof.
Upon the termination of Executive's employment for any reason, he
shall, upon the request of the Company, resign from all corporate
offices held by Executive.
(b) Effect of Termination by Death. Upon the termination of
Executive's employment as a result of Death, Executive's estate shall
be entitled to receive an amount equal to: (i) accrued but unpaid Base
Salary through the date of termination; (ii) a pro rata portion of
Executive's Annual Bonus, if any, for the year in which termination
occurs, (iii) any unpaid portion of the Annual Bonuses for prior
calendar years, accrued and unpaid vacation pay, unreimbursed expenses
incurred pursuant to Section 5(a), (b) or (e), and any other benefits
owed to Executive pursuant to any written employee benefit plan or
policy of the Company, excluding benefits payable pursuant to any plan
beneficiary pursuant to a contractual beneficiary designation by
Executive, (iv) the portion of the Restricted Stock Grant that is free
from restrictions as of the date of death and the acceleration and
immediate release of all restrictions from all Restricted Stock Grants
that are subject to restrictions as of the date of death, (v)
Executive's vested Stock Options as of the date of death, the vesting
and exercise of which is governed by the Omnibus Plan; and (vi) all of
Executive's Stock Options, which pursuant to the Omnibus Plan are
accelerated as of the termination date (date of death) and are
exercisable until the expiration of the Stock Option Term.
(c) Effect of Termination for Permanent Disability. Upon the
termination of Executive's employment hereunder as a result of
Permanent Disability, Executive shall be entitled to receive an amount
equal to: (i) accrued but unpaid Base Salary through the date of
termination; (ii) a pro rata portion of Executive's Annual Bonus, if
any, for the year in which termination occurs, (iii) any unpaid portion
of an Annual Bonus for prior calendar years, long-term disability
benefits available to executives of the Company, accrued and unpaid
vacation pay, unreimbursed expenses incurred pursuant to Section 5(a),
(b) or (e) and any other benefits owed to Executive pursuant to any
written employee benefit plan or policy of the Company; (iv) the
portion of the Restricted Stock Grant that is free from restrictions as
of the termination date; (v) Executive's vested Stock Options as of the
date of termination, the vesting of which is governed by the Omnibus
Plan; and (vi) all of Executive's Stock Options, which pursuant to the
Omnibus Plan are accelerated as of the termination date and are
exercisable until the expiration of the Stock Option Term. Payments to
Executive hereunder shall be reduced by any payments received by
Executive under any worker's compensation or similar law.
(d) Effect of Termination by the Company for Cause or by
Executive Without Good Reason. Upon the termination of Executive's
employment by the Company for Cause or by Executive for any reason
other than Good Reason, Executive shall be entitled to receive an
amount equal to: (i) accrued but unpaid Base Salary through the date of
termination, (ii) any unpaid Annual Bonus for prior calendar years,
accrued but unpaid vacation pay, unreimbursed expenses incurred
pursuant to Section 5(a), (b) or (e) and any other benefits owed to
Executive pursuant to any written employee benefit plan or policy of
the Company; and (iii) the portion of the Restricted Stock Grant that
is free from restrictions as of the
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termination date. All Stock Options, to the extent not theretofore
exercised, shall terminate on the date of termination of employment
under this Section 7(d). Executive shall also forfeit any right to an
Annual Bonus for the calendar year in which Executive's termination
occurs.
(e) Effect of Termination by the Company Without Cause or by
Executive for Good Reason. Upon the termination of Executive's
employment hereunder by the Company Without Cause or by Executive for
Good Reason, Executive shall be entitled to: (i) the payment of two (2)
times Executive's Base Salary for the year in which such termination
shall occur; (ii) payment of two (2) times Executive's Annual Bonus for
the preceding year, (iii) any unpaid portion of any Annual Bonus for
prior calendar years, accrued and unpaid vacation pay, unreimbursed
expenses incurred pursuant to Section 5(a), (b),or (e) and any other
benefits owed to Executive pursuant to any written employee benefit
plan or policy of the Company; (iv) the portion of the Restricted Stock
Grant that is free from restrictions as of the date of termination and
the acceleration and immediate release of all restrictions from up to
8,000 shares of the Restricted Stock Grant that are subject to
restrictions as of the date of termination and immediate release of all
restrictions from a pro-rata portion of the units of restricted stock
grants under the Company's Performance Accelerated Restricted Stock
Unit Program ("PARSUP") that are subject to restrictions as of the date
of termination (for purposes of this clause, the number of PARSUP units
that shall vest early shall be an amount equal to the number of
unvested PARSUP units on the date of termination multiplied by a
fraction, the numerator of which is total number of months (including
any fractional month) during which Executive was employed hereunder
commencing with February 2003 (up to 60), and the denominator of which
is 60); and (v) the vested portion of Executive's Stock Options, and
the acceleration and immediate vesting of Executive's unvested Stock
Options that were scheduled to vest during the two-year period
following the date of Executive's termination. Executive shall have two
(2) years from the date of such termination Without Cause or by
Executive for Good Reason to exercise all vested Stock Options.
8. CHANGE OF CONTROL.
(a) Definition. A "Change of Control" shall be deemed to have
taken place if:
(i) any person or entity, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of 1934,
other than the Company, a wholly-owned subsidiary thereof, or any
employee benefit plan of the Company or any of its subsidiaries becomes
the beneficial owner of Company securities having 35% or more of the
combined voting power of the then outstanding securities of the Company
that may be cast for the election of directors of the Company (other
than as a result of the issuance of securities initiated by the Company
in the ordinary course of business);
(ii) individuals who, as of the date of this
Amendment, were members of the Board (the "Incumbent Board") cease for
any reason to constitute at least a majority of the members of the
Board; provided that any individual who becomes a director after such
date whose election or nomination for election by the Company's
shareholders was approved by two-thirds of the members of the Incumbent
Board (other than an election or nomination of an individual whose
initial assumption of office is in connection with an actual or
threatened "election contest" relating to the election of the directors
of the Company (as such terms are used in Rule 14a-11 under the
Securities Exchange Act of 1934), "tender offer" (as such term is used
in Section 14(d) of the Securities Exchange Act of 1934) or a proposed
transaction described in clause (iii) below) shall be deemed to be
members of the Incumbent Board."
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(iii) as the result of, or in connection with, any
cash tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions, the holders of all the Company's securities
entitled to vote generally in the election of directors of the Company
immediately prior to such transaction constitute, following such
transaction, less than a majority of the combined voting power of the
then-outstanding securities of the Company or any successor corporation
or entity entitled to vote generally in the election of the directors
of the Company or such other corporation or entity after such
transactions; or
(iv) the Company sells all or substantially all of the assets
of the Company.
(b) Effect of Change of Control. In the event that within one
(1) year following a Change of Control, the Company terminates
Executive Without Cause or Executive terminates employment for Good
Reason, Executive shall be entitled to: (i) the payment of three (3)
times Executive's Base Salary for the year in which such termination
shall occur; (ii) the payment of three (3) times Executive's Annual
Bonus for the preceding year; (iii) any unpaid portion of any Annual
Bonus for prior calendar years, accrued and unpaid vacation pay,
unreimbursed expenses incurred pursuant to Section 5(a), (b),or (e) and
any other benefits owed to Executive pursuant to any written employee
benefit plan or policy of the Company; (iv) the portion of the
Restricted Stock Grant that is free from restrictions as of the date of
termination and the acceleration and immediate release of all
restrictions from all Restricted Stock Grants that are subject to
restrictions as of the date of termination; and (v) the vested portion
of Executive's Stock Options and the acceleration and immediate vesting
of any unvested portion of Executive's Stock Options. Executive shall
have two (2) years from the date of such termination to exercise all
vested Stock Options.
9. EXCISE TAX REIMBURSEMENT. In connection with or arising out of a
Change in Control of the Company, in the event Executive shall be subject to the
tax imposed by Section 4999 of the Code (the "Excise Tax") in respect of any
payment or distribution by the Company or any other person or entity to or for
Executive's benefit, whether paid or payable or distributed or distributable
pursuant to the terms of this Agreement or otherwise, or whether prior to or
following any termination of Executive other than Termination for Cause or By
Executive without Good Reason (a "Payment"), the Company shall pay to Executive
an additional amount. The additional amount (the "Gross-Up Payment") shall be
equal to the Excise Tax, together with any federal, state and local income tax,
employment tax and any other taxes associated with this payment such that
Executive incurs no out-of-pocket expenses associated with the Excise Tax.
Provided, however, nothing in this Section shall obligate the Company to pay
Executive for any federal, state or local income taxes imposed upon Executive by
virtue of a Payment. For purposes of determining whether any of the Payments
will be subject to the Excise Tax and the amount of such Excise Tax the
following will apply:
(a) Determination of Parachute Payments. Any payments or
benefits received or to be received by Executive in connection with a
Change in Control of the Company or his termination of employment other
than by the Company for Cause or by Executive Without Good Reason shall
be treated as "parachute payments" within the meaning of Section
280G(b)(2) of the Code, and all "excess parachute payments" within the
meaning of Section 280G(b)(1) shall be treated as subject to the Excise
Tax, unless in the opinion of tax counsel selected by the Company's
independent auditors and acceptable to Executive such other payments or
benefits (in whole or in part) do not constitute parachute payments, or
such excess parachute payments (in whole or in part) represent
reasonable compensation for
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services actually rendered within the meaning of Section 280G(b)(3) of
the Code, or are otherwise not subject to the Excise Tax; and
(b) Valuation of Benefits and Determination of Tax Rates. The
value of any non-cash benefits or any deferred payment or benefit shall
be determined by the Company's independent auditors in accordance with
proposed, temporary or final regulations under Section 280G(d)(3) and
(4) of the Code or, in the absence of such regulations, in accordance
with the principles of Section 280G(d)(3) and (4) of the Code. For
purposes of determining the amount of the Gross-Up Payment, Executive
shall be deemed to pay federal income taxes at the highest marginal
rate of federal income taxation in the calendar year in which the
Gross-Up Payment is to be made and state and local income taxes at the
highest marginal rate of taxation in the state and locality of
Executive's residence on the date of termination of his employment, net
of the applicable reduction in federal income taxes which could be
obtained from deduction of such state and local taxes.
(c) Repayment of Gross-Up by Executive and Possible Additional
Gross-Up by Company. In the event that the amount of Excise Tax
attributable to Payments is subsequently determined to be less than the
amount taken into account hereunder at the time of termination of
Executive's employment, he shall repay to the Company at the time that
the amount of such reduction in Excise Tax is finally determined the
portion of the Gross-Up Payment attributable to such reduction
(including the portion of the Gross-Up Payment attributable to the
Excise Tax, employment tax and federal (and state and local) income tax
imposed on the Gross-Up Payment being repaid by Executive if such
repayment results in a reduction in Excise Tax and/or a federal (and
state and local) income tax deduction) plus interest on the amount of
such repayment at the rate provided in section 1274(b)(2)(B) of the
Code. In the event that the Excise Tax attributable to Payments is
determined to exceed the amount taken into account hereunder at the
time of the termination of Executive's employment (including by reason
of any payment the existence or amount of which cannot be determined at
the time of the Gross-Up Payment), the Company shall make an additional
gross-up payment in respect of such excess (plus any interest and/or
penalties payable by Executive with respect to such excess) at the time
that the amount of such excess is finally determined.
10. EXECUTIVE COVENANTS.
(a) General. Executive and the Company understand and agree
that the purpose of the provisions of this Section 10 is to protect
legitimate business interests of the Company, as more fully described
below, and is not intended to impair or infringe upon Executive's right
to work, earn a living, or acquire and possess property from the fruits
of his labor. Executive hereby acknowledges that the post-employment
restrictions set forth in this Section 10 are reasonable and that they
do not, and will not, unduly impair his ability to earn a living after
the termination of his employment with the Company. Therefore, subject
to the limitations of reasonableness imposed by law upon restrictions
set forth herein, Executive shall be subject to the restrictions set
forth in this Section 10.
(b) Definitions. The following capitalized terms used in this
Section 10 shall have the meanings assigned to them below, which
definitions shall apply to both the singular and the plural forms of
such terms: "Confidential Information" means any confidential or
proprietary information possessed by the Company without limitation,
any confidential "know-how," customer lists, details of client and
consultant contracts, current and anticipated customer requirements,
pricing policies, price lists, market studies, business plans,
operational methods, marketing plans or strategies, product development
techniques or plans,
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computer software programs (including object code and source code),
data and documentation, data base technologies, systems, structures and
architectures, inventions and ideas, past, current and planned research
and development, compilations, devices, methods, techniques, processes,
financial information and data, business acquisition plans, new
personnel acquisition plans and any other information that would
constitute a trade secret under the common law or statutory law of the
State of Tennessee.
"Person" means any individual or any corporation,
partnership, joint venture, association or other entity or
enterprise.
"Protected Employees" means employees of the Company
or its affiliated companies who are employed by the Company or
its affiliated companies at any time within six (6) months
prior to the date of termination of Executive for any reason
whatsoever or any earlier date (during the Restricted Period)
of an alleged breach of the Restrictive Covenants by
Executive.
"Restricted Period" means the period of Executive's
employment by the Company plus a period extending two (2)
years from the date of termination of employment; provided,
however, the Restricted Period shall be extended for a period
equal to the time during which Executive is in breach of his
obligations to the Company under this Section 10.
"Restrictive Covenants" means the restrictive
covenants contained in Section 10(c) hereof:
(c) Restrictive Covenants.
(i) Restriction on Disclosure and Use of Confidential
Information. Executive understands and agrees that the
Confidential Information constitutes a valuable asset of the
Company and its affiliated entities, and may not be converted
to Executive's own use or converted by Executive for the use
of any other Person. Accordingly, Executive hereby agrees that
Executive shall not, directly or indirectly, at any time
during the Restricted Period or thereafter, reveal, divulge or
disclose to any Person not expressly authorized by the Company
any Confidential Information, and Executive shall not, at any
time during the Restricted Period or thereafter, directly or
indirectly, use or make use of any Confidential Information in
connection with any business activity other than that of the
Company. The parties acknowledge and agree that this Agreement
is not intended to, and does not, alter either the Company's
rights or Executive's obligations under any state or federal
statutory or common law regarding trade secrets and unfair
trade practices,
(ii) Non-solicitation of Protected Employees.
Executive understands and agrees that the relationship between
the Company and each of its Protected Employees constitutes a
valuable asset of the Company and may not be converted to
Executive's own use or converted by Executive for the use of
any other Person. Accordingly, Executive hereby agrees that
during the Restricted Period Executive shall not directly or
indirectly on Executive's own behalf or on behalf of any
Person solicit any Protected Employee to terminate his or her
employment with the Company.
(iii) Non-interference with Company Opportunities.
Executive understands and agrees that all business
opportunities with which he is involved
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during his employment with the Company constitute valuable
assets of the Company and its affiliated entities, and may not
be converted to Executive's own use or converted by Executive
for the use of any other Person. Accordingly, Executive hereby
agrees that during the Restricted Period or thereafter,
Executive shall not directly or indirectly on Executive's own
behalf or on behalf of any Person, interfere with, solicit,
pursue, or in any way make use of any such business
opportunities.
(d) Exceptions from Disclosure Restrictions. Anything herein
to the contrary notwithstanding, Executive shall not be restricted from
disclosing or using Confidential Information that: (i) is or becomes
generally available to the public other than as a result of an
unauthorized disclosure by Executive or his agent; (ii) becomes
available to Executive in a manner that is not in contravention of
applicable law from a source (other than the Company or its affiliated
entities or one of its or their officers, employees, agents or
representatives) that is not known by Executive, after reasonable
investigation, to be bound by a confidential relationship with the
Company or its affiliated entities or by a confidentiality or other
similar agreement; or (iii) is required to be disclosed by law, court
order or other legal process; provided, however, that in the event
disclosure is required by law, court order or legal process, Executive
shall provide the Company with prompt notice of such requirement so
that the Company may seek an appropriate protective order prior to any
such required disclosure by Executive.
(e) Enforcement of the Restrictive Covenants.
(i) Rights and Remedies upon Breach. In the event
Executive breaches, or threatens to commit a breach of, any of the
provisions of the Restrictive Covenants, the Company shall have the
right and remedy to enjoin, preliminarily and permanently, Executive
from violating or threatening to violate the Restrictive Covenants and
to have the Restrictive Covenants specifically enforced by any court of
competent jurisdiction, it being agreed that any breach or threatened
breach of the Restrictive Covenants would cause irreparable injury to
the Company and that money damages would not provide an adequate remedy
to the Company. The rights referred to herein shall be independent of
any others and severally enforceable, and shall be in addition to, and
not in lieu of, any other rights and remedies available to the Company
at law or in equity.
(ii) Severability of Covenant. Executive acknowledges
and agrees that the Restrictive Covenants are reasonable and valid in
all respects. If any court determines that any Restrictive Covenants,
or any part thereof, is invalid or unenforceable, the remainder of the
Restrictive Covenants shall not thereby be affected and shall be given
full effect, without regard to the invalid portions.
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11. COOPERATION IN FUTURE MATTERS. Executive hereby agrees that, for a
period of three (3) years following the date of his termination, he shall
cooperate with the Company's reasonable requests relating to matters that
pertain to Executive's employment by the Company, including, without limitation,
providing information of limited consultation as to such matters, participating
in legal proceedings, investigations or audits on behalf of the Company, or
otherwise making himself reasonably available to the Company for other related
purposes. Any such cooperation shall be performed at times scheduled taking into
consideration Executive's other commitments, and Executive shall be compensated
(except for cooperation in connection with legal proceedings) at a reasonable
hourly or per diem rate to be agreed by the parties to the extent such
cooperation is required on more than an occasional and limited basis. Executive
shall also be reimbursed for all reasonable out of pocket expenses. Executive
shall not be required to perform such cooperation to the extent it conflicts
with any requirements of exclusivity of service for another employer or
otherwise, nor in any manner that in the good faith belief of Executive would
conflict with his rights under or ability to enforce this Agreement.
12. INDEMNIFICATION. The Company shall indemnify Executive and hold him
harmless from and against any and all costs, expenses, losses, claims, damages,
obligations or liabilities (including actual attorneys fees and expenses)
arising out of any acts or failures to act by the Company, its directors,
employees or agents that occurred prior to the Effective Date, or arising out of
or relating to any acts, or omissions to act, made by Executive on behalf of or
in the course of performing services for the Company to the fullest extent
permitted by the Bylaws of the Company, or, if greater, as permitted by
applicable law, as the same shall be in effect from time to time. If any claim,
action, suit or proceeding is brought, or any claim relating thereto is made,
against Executive with respect to which indemnity may be sought against the
Company pursuant to this Section, Executive shall notify the Company in writing
thereof, and the Company shall have the right to participate in, and to the
extent that it shall wish, in its discretion, assume and control the defense
thereof, with counsel satisfactory to Executive.
13. EXECUTIVE'S REPRESENTATIONS AND WARRANTIES. Executive represents
and warrants that he is free to enter into this Agreement and, as of the
Effective Date, that he is not subject to any conflicting obligation or any
disability which shall prevent or hinder Executive's execution of this Agreement
or the performance of his obligations hereunder; that no lawsuits or claims are
pending or, to Executive's knowledge, threatened against Executive; and that he
has never been subject to bankruptcy, insolvency, or similar proceedings, has
never been convicted of a felony or a crime involving moral turpitude, and has
never been subject to an investigation or proceeding by or before the Securities
and Exchange Commission or any state securities commission. The Company shall
have the authority to conduct an independent investigation into the background
of Executive and Executive agrees to fully cooperate in any such investigation.
The Company shall notify Executive if it intends to conduct such an
investigation.
14. NOTICES. Any and all notices or other communications required or
permitted to be given under any of the provisions of this Agreement shall be in
writing and shall be deemed to have been duly given when personally delivered or
mailed by first class registered mail, return receipt requested, or by
commercial courier or delivery service, or by facsimile or electronic mail,
addressed to the parties at the addresses set forth below (or at such other
address as any party may specify by notice to all other parties given as
aforesaid):
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(a) if to the Company, to:
Gaylord Entertainment Company
One Gaylord Drive
Nashville, Tennessee 37214
Attention: President
Facsimile Number: (615) 316-6010
(b) if to Executive, to:
David C. Kloeppel
c/o Gaylord Entertainment Company
One Gaylord Drive
Nashville, TN 37214
and/or to such other persons and addresses as any party shall have specified in
writing to the other by notice as aforesaid.
15. MISCELLANEOUS.
(a) Entire Agreement. This Agreement constitutes the entire
agreement of the parties with respect to the subject matter hereof and
supercedes and replaces in its entirety Executive's September 4, 2001
employment agreement with the Company. This Agreement may not be
modified, amended, or terminated except by a written agreement signed
by all of the parties hereto. Nothing contained in this Agreement shall
be construed to impose any obligation on the Company to renew this
Agreement and neither the continuation of employment nor any other
conduct shall be deemed to imply a continuing obligation upon the
expiration of this Agreement.
(b) Assignment; Binding Effect. This Agreement shall not be
assignable by Executive, but it shall be binding upon, and shall inure
to the benefit of, his heirs, executors, administrators, and legal
representatives. This Agreement shall be binding upon the Company and
inure to the benefit of the Company and its respective successors and
permitted assigns. This Agreement may only be assigned by the Company
to an entity controlling, controlled by, or under common control with
the Company; provided, however, that no such assignment shall relieve
the Company of any of its obligations hereunder.
(c) Waiver. No waiver of any breach or default hereunder shall
be considered valid unless in writing, and no such waiver shall be
deemed a waiver of any subsequent breach or default of the same or
similar nature.
(d) Enforceability. Subject to the terms of Section 12(e)
hereof, if any provision of this Agreement shall be held invalid or
unenforceable, such invalidity or unenforceability shall attach only to
such provision and shall not in any manner affect or render invalid or
unenforceable any other severable provision of this Agreement, and this
Agreement shall be carried out as if any such invalid or unenforceable
provision were not contained herein, unless the invalidity or
unenforceability of such provision substantially impairs the benefits
of the remaining portions of this Agreement.
(e) Headings. The section headings contained herein are for
the purposes of convenience only and are not intended to define or
limit the contents of the sections.
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(f) Counterparts. This Agreement may be executed in two or
more counterparts, all of which taken together shall be deemed one
original.
(g) Confidentiality of Agreement. The parties agree that the
terms of this Agreement as they relate to compensation, benefits, and
termination shall, unless otherwise required by law (including, in the
Company's reasonable judgment, as required by federal and state
securities laws), be kept confidential; provided, however, that any
party hereto shall be permitted to disclose this Agreement or the terms
hereof with any of its legal, accounting, or financial advisors
provided that such party ensures that the recipient shall comply with
the provisions of this Section 17(g).
(h) Governing Law. This Agreement shall be deemed to be a
contract under the laws of the State of Tennessee and for all purposes
shall be construed and enforced in accordance with the internal laws of
said state.
(i) No Third Party Beneficiary. This Agreement shall not
confer any rights or remedies upon any person or entity other than the
parties hereto and their respective successors and permitted assigns.
(j) Arbitration. Any controversy or claim between or among the
parties hereto, including but not limited to those arising out of or
relating to this Agreement or any related agreements or instruments,
including any claim based on or arising from an alleged tort, shall be
determined by binding arbitration in accordance with the Federal
Arbitration Act (or if not applicable, the law of the state of
Tennessee), the Commercial Arbitration Rules of the American
Arbitration Association in effect as of the date hereof, and the
provisions set forth below. In the event of any inconsistency, the
provisions herein shall control. Judgment upon any arbitration award
may be entered in any court having jurisdiction. Any party to the
Agreement may bring an action, including a summary or expedited
proceeding, to compel arbitration of any controversy or claim to which
this Agreement applies in any court having jurisdiction over such
action; provided, however, that all arbitration proceedings shall take
place in Nashville, Tennessee. The arbitration body shall set forth its
findings of fact and conclusions of law with citations to the evidence
presented and the applicable law, and shall render an award based
thereon. In making its determinations and award(s), the arbitration
body shall base its award on applicable law and precedent, and shall
not entertain arguments regarding punitive damages, nor shall the
arbitration body award punitive damages to any person. Each party shall
bear its own costs and expenses.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
GAYLORD ENTERTAINMENT COMPANY
By: /s/ Colin V. Reed
-------------------------------------
Colin V. Reed
President and Chief Executive Officer
EXECUTIVE:
/s/ David C. Kloeppel
-----------------------------------------
David C. Kloeppel
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