x
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Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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o
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Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Tennessee
(State or other jurisdiction of incorporation or organization)
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62‑0812904
(I.R.S. Employer Identification Number)
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305 Hartmann Drive, P.O. Box 787
Lebanon, Tennessee
(Address of principal executive offices)
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37088‑0787
(Zip code)
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Title of each class
Common Stock (Par Value $.01)
Rights to Purchase Series A Junior Participating
Preferred Stock (Par Value $0.01)
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Name of each exchange on which registered
The NASDAQ Stock Market LLC
(NASDAQ Global Select Market)
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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Document from which Portions
are Incorporated by Reference
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Part of Form 10‑K
into which incorporated
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1.
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Proxy Statement for Annual Meeting of Shareholders to be held November 13, 2013 (the “2013 Proxy Statement”)
|
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Part III
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PART I
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4
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||
ITEM 1.
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5
|
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ITEM 1A.
|
10
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ITEM 1B.
|
21
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ITEM 2.
|
21
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ITEM 3.
|
22
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23
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PART II
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ITEM 5.
|
24
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ITEM 6.
|
25
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ITEM 7.
|
26
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ITEM 7A.
|
42
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ITEM 8.
|
44
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ITEM 9.
|
68
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ITEM 9A.
|
69
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ITEM 9B.
|
71
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PART III
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|
|
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ITEM 10.
|
71
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ITEM 11.
|
72
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ITEM 12.
|
72
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ITEM 13.
|
72
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ITEM 14.
|
72
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PART IV
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|
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|
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ITEM 15.
|
72
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|
|
|
|
73
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||
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|
|
74
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Prices Range
|
|||
Breakfast
|
$
|
3.49 to $9.19
|
||
Lunch and Dinner
|
$
|
4.59 to $13.99
|
|
Percentage of Restaurant Sales in 2013
|
|||
Breakfast Day-Part (until 11:00 a.m.)
|
24
|
%
|
||
Lunch Day-Part (11:00 a.m. to 4:00 p.m.)
|
38
|
%
|
||
Dinner (4:00 p.m. to close)
|
38
|
%
|
|
Percentage of Retail Sales in 2013
|
|||
Apparel and Accessories
|
27
|
%
|
||
Food
|
18
|
%
|
||
Toys
|
13
|
%
|
||
Décor
|
13
|
%
|
||
Bed and Bath
|
9
|
%
|
|
Percentage of Food Purchases in 2013
|
|||
Beef
|
13
|
%
|
||
Dairy (including eggs)
|
12
|
%
|
||
Fruits and vegetables
|
12
|
%
|
||
Poultry
|
11
|
%
|
||
Pork
|
11
|
%
|
· | fluctuating currency exchange rates; |
· | foreign government regulations; |
· | foreign currency exchange control regulations; |
· | import/export restrictions and product testing regulations; |
· | foreign political and economic instability; |
· | disruptions due to labor stoppages, strikes or slowdowns, or other disruptions, involving our vendors or the transportation and handling industries; and |
· | tariffs, trade barriers and other trade restrictions by the U.S. government on products or components shipped from foreign sources. |
· | increases and decreases in average weekly sales, restaurant and retail sales and restaurant profitability; |
· | the rate at which we open new stores, the timing of new store openings and the related high initial operating costs; |
· | changes in advertising and promotional activities and expansion into new markets; and impairment of long-lived assets and any loss on store closures. |
· | responding to proxy contests and other actions by activist shareholders can disrupt our operations, be costly and time-consuming, and divert the attention of our management and employees; |
· | perceived uncertainties as to our future direction may result in the loss of potential business opportunities, and may make it more difficult to attract and retain qualified personnel and business partners; and |
· |
if individuals are elected to our board of directors
to pursue an activist shareholder’s particular
agenda, it
may adversely affect our ability to effectively implement our business strategy and create additional value for our shareholders.
|
Name
|
Age
|
Position with the Company
|
|
|
|
Sandra B. Cochran
|
55
|
President and Chief Executive Officer
|
|
|
|
Lawrence E. Hyatt
|
58
|
Senior Vice President and Chief Financial Officer
|
|
|
|
Douglas E. Barber
|
56
|
Executive Vice President and Chief People Officer
|
|
|
|
Christopher A. Ciavarra
|
42
|
Senior Vice President, Marketing
|
|
|
|
Laura A. Daily
|
49
|
Senior Vice President, Retail
|
|
|
|
Nicholas V. Flanagan
|
47
|
Senior Vice President, Operations
|
|
|
|
Edward A. Greene
|
58
|
Senior Vice President, Strategic Initiatives
|
|
|
|
P. Douglas Couvillion
|
49
|
Vice President, Corporate Controller and Principal Accounting Officer
|
|
|
|
Michael J. Zylstra
|
47
|
Vice President, General Counsel and Secretary
|
Fiscal Year 2013
|
Fiscal Year 2012
|
|||||||||||||||||||||||||||||||
Prices
|
Dividends |
Dividends
|
Prices
|
Dividends |
Dividends
|
|||||||||||||||||||||||||||
High
|
Low
|
Declared |
Paid
|
High
|
Low
|
Declared |
Paid
|
|||||||||||||||||||||||||
First
|
$
|
69.30
|
$
|
62.06
|
$
|
0.50
|
$
|
0.40
|
$
|
45.80
|
$
|
37.31
|
$
|
0.25
|
$
|
0.22
|
||||||||||||||||
Second
|
65.94
|
60.07
|
0.50
|
0.50
|
53.77
|
41.08
|
0.25
|
0.25
|
||||||||||||||||||||||||
Third
|
84.41
|
64.53
|
0.50
|
0.50
|
59.90
|
52.02
|
0.65
|
0.25
|
||||||||||||||||||||||||
Fourth
|
102.95
|
83.02
|
0.75
|
0.50
|
64.33
|
56.26
|
--
|
0.25
|
|
(Dollars in thousands except percentages and share data)
|
|||||||||||||||||||
|
For each of the fiscal years ended
|
|||||||||||||||||||
|
August 2,
2013
(a)
|
August 3,
2012
(b)
|
July 29,
2011
(c)
|
July 30,
2010
(d)
|
July 31,
2009
(e)(f)
|
|||||||||||||||
Selected Income Statement Data:
|
|
|
|
|
|
|||||||||||||||
Total revenue
|
$
|
2,644,630
|
$
|
2,580,195
|
$
|
2,434,435
|
$
|
2,404,515
|
$
|
2,367,285
|
||||||||||
Income from continuing operations
|
117,265
|
103,081
|
85,208
|
85,258
|
65,957
|
|||||||||||||||
Net income
|
117,265
|
103,081
|
85,208
|
85,258
|
65,926
|
|||||||||||||||
Net income and income from continuing operations per share:
|
||||||||||||||||||||
Basic
|
4.95
|
4.47
|
3.70
|
3.71
|
2.94
|
|||||||||||||||
Diluted
|
4.90
|
4.40
|
3.61
|
3.62
|
2.89
|
|||||||||||||||
Dividends declared per share
|
2.25
|
1.15
|
0.88
|
0.80
|
0.80
|
|||||||||||||||
Dividends paid per share
|
1.90
|
0.97
|
0.86
|
0.80
|
0.78
|
|||||||||||||||
|
||||||||||||||||||||
As Percent of Total Revenue:
|
||||||||||||||||||||
Cost of goods sold
|
32.3
|
%
|
32.1
|
%
|
31.7
|
%
|
31.0
|
%
|
32.3
|
%
|
||||||||||
Labor and related expenses
|
36.5
|
36.8
|
37.1
|
37.8
|
38.7
|
|||||||||||||||
Other store operating expenses
|
18.2
|
18.0
|
18.6
|
18.2
|
17.8
|
|||||||||||||||
Store operating income
|
13.0
|
13.1
|
12.6
|
13.0
|
11.2
|
|||||||||||||||
General and administrative expenses
|
5.4
|
5.7
|
5.7
|
6.1
|
5.1
|
|||||||||||||||
Impairment and store dispositions, net
|
--
|
--
|
--
|
0.1
|
0.1
|
|||||||||||||||
Operating income
|
7.6
|
7.4
|
6.9
|
6.8
|
6.0
|
|||||||||||||||
Income before income taxes
|
6.3
|
5.7
|
4.8
|
4.8
|
3.8
|
|||||||||||||||
|
||||||||||||||||||||
Selected Balance Sheet Data:
|
||||||||||||||||||||
Working capital (deficit)
|
$
|
(13,873
|
)
|
$
|
18,249
|
$
|
(21,188
|
)
|
$
|
(73,289
|
)
|
$
|
(66,637
|
)
|
||||||
Total assets
|
1,388,306
|
1,418,992
|
1,310,884
|
1,292,067
|
1,245,181
|
|||||||||||||||
Current interest rate swap liability
|
--
|
20,215
|
--
|
--
|
--
|
|||||||||||||||
Long-term debt
|
400,000
|
525,036
|
550,143
|
573,744
|
638,040
|
|||||||||||||||
Long-term interest rate swap liability
|
11,644
|
14,166
|
51,604
|
66,281
|
61,232
|
|||||||||||||||
Other long-term obligations
|
120,073
|
114,897
|
105,661
|
93,822
|
89,670
|
|||||||||||||||
Shareholders’ equity
|
484,026
|
382,675
|
268,034
|
191,617
|
135,622
|
Selected Cash Flow Data:
|
|
|
|
|
|
|||||||||||||||
Purchase of property and equipment, net
|
$
|
73,961
|
$
|
80,170
|
$
|
77,686
|
$
|
69,891
|
$
|
67,842
|
||||||||||
Share repurchases
|
3,570
|
14,923
|
33,563
|
62,487
|
--
|
Selected Other Data:
|
|
|
|
|
|
|||||||||||||||
Common shares outstanding at end of year
|
23,795,327
|
23,473,024
|
22,840,974
|
22,732,781
|
22,722,685
|
|||||||||||||||
Stores open at end of year
|
624
|
616
|
603
|
593
|
588
|
|||||||||||||||
|
||||||||||||||||||||
Average Unit Volumes
(g)
:
|
||||||||||||||||||||
Restaurant
|
$
|
3,390
|
$
|
3,369
|
$
|
3,234
|
$
|
3,226
|
$
|
3,209
|
||||||||||
Retail
|
869
|
863
|
837
|
832
|
841
|
|||||||||||||||
|
||||||||||||||||||||
Comparable Store Sales
(h)
:
|
||||||||||||||||||||
Period to period increase (decrease) in comparable store sales:
|
||||||||||||||||||||
Restaurant
|
3.1
|
%
|
2.2
|
%
|
0.2
|
%
|
0.8
|
%
|
(1.7
|
)%
|
||||||||||
Retail
|
2.9
|
1.6
|
0.7
|
(0.9
|
)
|
(5.9
|
)
|
|||||||||||||
Memo: Number of stores in comparable base
|
596
|
591
|
583
|
569
|
550
|
(a) | We incurred $4,111 in costs related to the November 2012 proxy contest, which are included in general and administrative expenses. |
(b) | Fiscal 2012 consisted of 53 weeks while all other periods presented consisted of 52 weeks. The estimated impact of the additional week was to increase consolidated fiscal 2012 results as follows: total revenue, $51,059; store operating income, 0.2% of total revenue ($11,093); operating income, 0.2% of total revenue ($9,723); net income, 0.2% of total revenue ($6,280); and diluted net income per share, $0.27. As part of our restructuring of our field organization in April 2012, we incurred severance charges of $1,660, which are included in general and administrative expenses. We also incurred $5,203 in costs related to the December 2011 proxy contest, which are also included in general and administrative expenses. |
(c)
|
Includes impairment charges of $3,219 before taxes and pre-tax gains on store dispositions of $4,109. Our debt refinancing in the fourth quarter of fiscal 2011 resulted in additional interest expense of $5,136 related to transaction fees and the write-off of deferred financing costs. During the fourth quarter of fiscal 2011, as part of our cost reduction and organization streamlining initiative, we incurred severance charges of $1,768, which are included in general and administrative expenses. We also incurred $404 in costs related to the December 2011 proxy contest, which are also included in general and administrative expenses.
|
(d) | Includes impairment charges of $2,672 before taxes. |
(e) | Includes impairment charges of $2,088 before taxes. We completed sale-leaseback transactions involving 15 of our stores and our retail distribution center in the fourth quarter of fiscal 2009 (see Note 10 to the Consolidated Financial Statements). Net proceeds from the sale-leaseback transactions together with excess cash flow from operations were used to pay down $142,759 of long-term debt. |
(f) | Certain expenses and proceeds related to the divestiture of Logan’s Roadhouse, Inc. are reported in discontinued operations in fiscal 2009. |
(g) | Average unit volumes include sales of all stores. Fiscal 2012 includes a 53 rd week while all other periods presented consist of 52 weeks. |
(h) | Comparable store sales consist of sales of stores open at least six full quarters at the beginning of the year; and are measured on comparable calendar weeks. |
· | Executive Overview – a general description of our business, the restaurant and retail industries, our key performance indicators and the Company’s performance in 2013. |
· | Results of Operations – an analysis of our consolidated statements of income for the three years presented in our Consolidated Financial Statements. |
· | Liquidity and Capital Resources – an analysis of our primary sources of liquidity, capital expenditures and material commitments. |
· | Critical Accounting Estimates – a discussion of accounting policies that require critical judgments and estimates. |
1) | Refresh select menu categories that will reinforce our value and provide healthier options to our guests. Having analyzed our marketplace, guests’ feedback and brand positioning, we focused our menu initiatives on satisfying our guests’ needs for affordable options, healthier items and customizable choices. As part of our fall and holiday promotions, we introduced new sides to meet guests’ preferences for lighter and healthier options to customize their meals. These sides later transitioned to our core menu. During the spring, we reinforced the affordability of our menu by refreshing and highlighting our Country Dinner Plates, which include over 10 entrée choices at a $7.69 price point. Seasonal promotions included limited time offerings of additional entrée choices. Throughout the year, we tested a new category for our menu, Wholesome Fixin’s®. The category will provide flavorful and fresh meals with under 600 calories. We introduced Wholesome Fixin’s in the first quarter of 2014. |
2) | Grow retail sales with unique merchandise. Further defining the distinctive Cracker Barrel experience, we focused on merchandising our stores with unique and nostalgic items. We developed collections with broad generational appeal and unique product assortments, such as our horse-theme merchandise and our American Pride assortment. One of our strongest categories, women’s apparel and accessories, continued to see growth throughout the year. |
3) | Build on the successful “Handcrafted by Cracker Barrel” advertising campaign. During the first quarter of 2013, we refreshed our billboards to our Handcrafted by Cracker Barrel advertising theme. Many of the billboards highlight our made-from-scratch cooking with slogans like “Homemade Doesn’t Cost Extra” and “Fresh Meals. Friendly Prices.” Other billboards highlighted our brand’s value and affordability. Of our 1,600 billboards, approximately 300 display sharp price-point messaging around our $5.99 Daily Lunch Specials or $7.69 Country Dinner Plates. In addition, we continued with our Handcrafted by Cracker Barrel media advertising and maintained the approach that we adopted in 2012, using national cable to drive brand awareness and spot radio to deliver product news during our busy holiday and summer seasons. We updated the radio spots with current menu and product offerings and ran new TV commercials during the summer campaign. |
4) |
Invest in and leverage technology and equipment to support operations and reduce costs.
In
our ongoing effort to improve operations, we focused on initiatives to lower expenses and improve the guest experience. During the first quarter of 2013, we increased productivity in our stores with
improved hourly labor scheduling that not only reduced costs but we believe
allowed our
store
managers
to spend
more time interact
ing
with guests. During the second quarter of 2013, we
implemented a new merchandise planning system that provides greater visibility to manage the products in our retail stores. During the third quarter of 2013, we rolled out the second phase of our production planning tool for store managers, which helped further reduce food waste. Also, during the third and fourth quarters of 2013, we invested in new equipment at our stores to better hold and prepare fresh ingredients, an important component for our menu expansion with Wholesome Fixin’s®.
|
5) | Continued focus on shareholder return. We returned capital to our shareholders directly through quarterly dividend payments. During the fourth quarter of 2013, we declared a dividend increase to $0.75 which was paid in the first quarter of 2014. This increase marked the third increase since November 2011 and represented a tripling of our quarterly dividend over that time period. During 2013, we repaid $125,000 in long term debt, opened eight new stores, and reinvested approximately $74,000 in the Company through capital expenditures. |
6) | Expand the brand through e-commerce and licensing . Throughout the year, we also engaged with our guests through multiple website and digital promotions. Also, during the year, we announced a multi-year licensing agreement with John Morrell Food Group, a subsidiary of Smithfield Foods. We look forward to the future potential of this partnership. See “Item 3. Legal Proceedings” of Part I of this Annual Report on Form 10-K for information related to a lawsuit filed against the Company regarding this initiative. |
|
|
Period to Period
|
||||||||||||||||||
|
Relationship to Total Revenue
|
Increase (Decrease)
|
||||||||||||||||||
|
2013
|
2012*
|
2011
|
2013
vs 2012
|
2012
vs 2011
|
|||||||||||||||
Total revenue
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
3
|
%
|
6
|
%
|
||||||||||
Cost of goods sold
|
32.3
|
32.1
|
31.7
|
3
|
7
|
|||||||||||||||
Gross profit
|
67.7
|
67.9
|
68.3
|
2
|
5
|
|||||||||||||||
Labor and other related expenses
|
36.5
|
36.8
|
37.1
|
1
|
5
|
|||||||||||||||
Other store operating expenses
|
18.2
|
18.0
|
18.6
|
4
|
3
|
|||||||||||||||
Store operating income
|
13.0
|
13.1
|
12.6
|
2
|
10
|
|||||||||||||||
General and administrative
|
5.4
|
5.7
|
5.7
|
(2
|
)
|
5
|
||||||||||||||
Impairment and store dispositions, net
|
--
|
--
|
--
|
--
|
(100
|
)
|
||||||||||||||
Operating income
|
7.6
|
7.4
|
6.9
|
6
|
14
|
|||||||||||||||
Interest expense
|
1.3
|
1.7
|
2.1
|
(20
|
)
|
(13
|
)
|
|||||||||||||
Income before income taxes
|
6.3
|
5.7
|
4.8
|
13
|
26
|
|||||||||||||||
Provision for income taxes
|
1.9
|
1.7
|
1.3
|
12
|
42
|
|||||||||||||||
Net income
|
4.4
|
4.0
|
3.5
|
14
|
21
|
|
2013
|
2012
|
2011
|
|||||||||
Revenue in dollars:
(1)
|
|
|
|
|||||||||
Restaurant
|
$
|
2,104,768
|
$
|
2,054,127
|
$
|
1,934,049
|
||||||
Retail
|
539,862
|
526,068
|
500,386
|
|||||||||
Total revenue
|
$
|
2,644,630
|
$
|
2,580,195
|
$
|
2,434,435
|
||||||
Total revenue percentage increase
(1)
|
2.5
|
%
|
6.0
|
%
|
1.2
|
%
|
||||||
Total revenue by percentage relationships:
|
||||||||||||
Restaurant
|
79.6
|
%
|
79.6
|
%
|
79.4
|
%
|
||||||
Retail
|
20.4
|
%
|
20.4
|
%
|
20.6
|
%
|
||||||
Comparable number of stores
|
596
|
591
|
583
|
|||||||||
Comparable store averages per store:
(2)
|
||||||||||||
Restaurant
|
$
|
3,409
|
$
|
3,375
|
$
|
3,238
|
||||||
Retail
|
871
|
861
|
833
|
|||||||||
Total
|
$
|
4,280
|
$
|
4,236
|
$
|
4,071
|
||||||
Restaurant average weekly sales
(3)
|
$
|
65.2
|
$
|
63.6
|
$
|
62.2
|
||||||
Retail average weekly sales
(3)
|
16.7
|
16.3
|
16.1
|
|
Period to Period Increase
|
|||||||
|
2013 vs 2012
|
2012 vs 2011
|
||||||
|
(596 Stores)
|
(591 Stores)
|
||||||
Restaurant
|
3.1
|
%
|
2.2
|
%
|
||||
Retail
|
2.9
|
1.6
|
||||||
Restaurant & Retail
|
3.0
|
2.1
|
|
2013
|
2012
|
*
|
2011
|
||||||||
Cost of Goods Sold:
|
|
|||||||||||
Restaurant
|
$
|
571,825
|
$
|
553,478
|
$
|
511,728
|
||||||
Retail
|
282,859
|
274,006
|
260,743
|
|||||||||
Total Cost of Goods Sold
|
$
|
854,684
|
$
|
827,484
|
$
|
772,471
|
|
2013
|
2012
|
2011
|
|||||||||
Restaurant Cost of Goods Sold
|
27.2
|
%
|
26.9
|
%
|
26.5
|
%
|
|
2013
|
2012
|
2011
|
|||||||||
Retail Cost of Goods Sold
|
52.4
|
%
|
52.1
|
%
|
52.1
|
%
|
|
2012 to 2013
Increase (Decrease) as a Percentage of Total Revenue
|
|||
Lower initial markup on certain merchandise
|
0.6
|
%
|
||
Freight
|
(0.2
|
%)
|
||
Retail inventory shrinkage
|
(0.1
|
%)
|
|
2012 to 2013
(Decrease) Increase as a Percentage of Total Revenue
|
|||
Store hourly labor
|
(0.5
|
%)
|
||
Store bonus expense
|
0.2
|
%
|
|
2011 to 2012
(Decrease) Increase as a Percentage of Total Revenue
|
|||
Store hourly labor
|
(0.3
|
%)
|
||
Health care costs
|
(0.2
|
%)
|
||
Store bonus expense
|
0.2
|
%
|
|
2012 to 2013
Increase (Decrease) as a Percentage of Total Revenue
|
|||
Advertising
|
0.1
|
%
|
||
Maintenance
|
0.1
|
%
|
||
Litigation settlement received in 2012
|
0.1
|
%
|
||
Utilities
|
(0.1
|
%)
|
|
2011 to 2012
(Decrease) Increase as a Percentage of Total Revenue
|
|||
Utilities
|
(0.2
|
%)
|
||
Litigation settlement received in 2012
|
(0.1
|
%)
|
||
Credit card fees
|
(0.1
|
%)
|
||
Supplies
|
(0.1
|
%)
|
||
Advertising
|
0.2
|
%
|
|
2012 to 2013
(Decrease) as a Percentage of Total Revenue
|
|||
Payroll and related expenses
|
(0.2
|
%)
|
||
Manager conference expense
|
(0.1
|
%)
|
|
2011 to 2012
(Decrease) Increase as a Percentage of Total Revenue
|
|||
Payroll and related expenses
|
(0.5
|
%)
|
||
Incentive compensation
|
0.3
|
%
|
||
Expenses related to December 2011 proxy contest
|
0.2
|
%
|
|
2013
|
2012
|
2011
|
|||||||||
Impairment
|
$
|
--
|
$
|
--
|
$
|
3,219
|
||||||
Gains on disposition of stores
|
--
|
--
|
(4,109
|
)
|
||||||||
Store closing costs
|
--
|
--
|
265
|
|||||||||
Total
|
$
|
--
|
$
|
--
|
$
|
(625
|
)
|
|
2013
|
2012
|
2011
|
|||||||||
Interest expense
|
$
|
35,742
|
$
|
44,687
|
$
|
51,490
|
|
2013
|
2012
|
2011
|
|||||||||
Effective tax rate
|
29.3
|
%
|
29.5
|
%
|
26.3
|
%
|
|
2013
|
2012
|
2011
|
|||||||||
Net cash provided by operating activities
|
$
|
208,499
|
$
|
219,822
|
$
|
138,212
|
||||||
Net cash used in investing activities
|
(73,406
|
)
|
(79,547
|
)
|
(69,489
|
)
|
||||||
Net cash used in financing activities
|
(165,337
|
)
|
(40,587
|
)
|
(64,149
|
)
|
||||||
Net (decrease) increase in cash and cash equivalents
|
$
|
(30,244
|
)
|
$
|
99,688
|
$
|
4,574
|
|
2013
|
2012
|
2011
|
|||||||||
Capital expenditures, net of proceeds from insurance recoveries
|
$
|
73,961
|
$
|
80,170
|
$
|
77,686
|
|
August 2, 2013
|
|||
Borrowing capacity under the Revolving Credit Facility
|
$
|
500,000
|
||
Less: Outstanding borrowings under the Revolving Credit Facility
|
212,500
|
|||
Less: Standby letters of credit*
|
28,971
|
|||
Borrowing availability under the Revolving Credit Facility
|
$
|
258,529
|
|
2013
|
2012
|
2011
|
|||||||||
Dividends per share paid
|
$
|
1.90
|
$
|
0.97
|
$
|
0.86
|
|
2013
|
2012
|
2011
|
|||||||||
Shares of common stock repurchased
|
44,300
|
265,538
|
676,600
|
|||||||||
Cost of shares repurchased
|
$
|
3,570
|
$
|
14,923
|
$
|
33,563
|
|
2013
|
2012
|
2011
|
|||||||||
Proceeds from exercise of share-based compensation awards
|
$
|
6,454
|
$
|
17,602
|
$
|
20,540
|
|
2013
|
2012
|
2011
|
|||||||||
Working capital (deficit)
|
$
|
(13,873
|
)
|
$
|
18,249
|
$
|
(21,188
|
)
|
|
|
Payments due by Years
|
||||||||||||||||||
Contractual Obligations
(a)
|
Total
|
2014
|
2015-2016
|
2017-2018
|
After 2018
|
|||||||||||||||
Term loan
(b)
|
$
|
187,500
|
--
|
$
|
187,500
|
--
|
--
|
|||||||||||||
Revolving Credit Facility
(b)
|
212,500
|
--
|
212,500
|
--
|
--
|
|||||||||||||||
Operating leases
(c)
|
766,444
|
$
|
59,075
|
89,346
|
$
|
81,040
|
$
|
536,983
|
||||||||||||
Purchase obligations
(d)
|
111,347
|
63,559
|
27,966
|
18,997
|
825
|
|||||||||||||||
Other long-term obligations
(e)
|
37,316
|
2,343
|
8,477
|
300
|
26,196
|
|||||||||||||||
Total contractual cash obligations
|
$
|
1,315,107
|
$
|
124,977
|
$
|
525,789
|
$
|
100,337
|
$
|
564,004
|
|
Amount of Commitment Expirations by Years
|
|||||||||||||||||||
|
Total
|
2014
|
2015-2016
|
2017-2018
|
After 2018
|
|||||||||||||||
Revolving Credit Facility
(b)
|
$
|
500,000
|
--
|
$
|
500,000
|
--
|
--
|
|||||||||||||
Standby letters of credit
(f)
|
28,971
|
$
|
8,335
|
20,636
|
--
|
--
|
||||||||||||||
Guarantees
(g)
|
827
|
168
|
228
|
$
|
235
|
$
|
196
|
|||||||||||||
Total commitments
|
$
|
529,798
|
$
|
8,503
|
$
|
520,864
|
$
|
235
|
$
|
196
|
(a) | At August 2, 2013, the entire liability for uncertain tax positions (including penalties and interest) is classified as a long-term liability. At this time, we are unable to make a reasonably reliable estimate of the amounts and timing of payments in individual years because of uncertainties in the timing of the effective settlement of tax positions. As such, the liability for uncertain tax positions of $28,841 is not included in the contractual cash obligations and commitments table above. |
(b) | Our term loan is payable on or before July 8, 2016 and our Revolving Credit Facility expires on July 8, 2016. Using our expected principal payments and projected interest rates, we anticipate having interest payments of $15,077 and $23,688 in 2014 and 2015-2016, respectively. The projected interest rates for our swapped portion of our outstanding borrowings are our fixed rates under our interest rate swaps (see Note 6 to the Consolidated Financial Statements) plus our current credit spread of 1.50%. The projected interest rate for our unswapped portion of our outstanding borrowings is the average of the three-year and five-year swap rates at August 2, 2013 of 1.33% plus our current credit spread. Even though our current credit facility expires in 2016, we have the intent and ability to refinance our debt to maintain a sufficient amount of outstanding borrowings during the terms of our interest rate swaps that expire in 2017 and 2018. Based on the fixed rates plus our current credit spread under these interest rate swaps, we anticipate having interest payments of $8,439 in 2017-2018. Based on our outstanding borrowings under our Revolving Credit Facility and standby letters of credit at August 2, 2013 and our current unused commitment fee as defined in the Credit Facility, our unused commitment fees in 2014 and 2015-2016 would be $646 and $1,255; however, the actual amount will differ based on actual usage of the Revolving Credit Facility in 2014 and 2015-2016. |
(c) | Includes base lease terms and certain optional renewal periods for which at the inception of the lease, it is reasonably assured that we will exercise. |
(d) | Purchase obligations consist of purchase orders for food and retail merchandise; purchase orders for capital expenditures, supplies, other operating needs and other services; and commitments under contracts for maintenance needs and other services. We have excluded contracts that do not contain minimum purchase obligations. We excluded long-term agreements for services and operating needs that can be cancelled within 60 days without penalty. We included long-term agreements and certain retail purchase orders for services and operating needs that can be cancelled with more than 60 days notice without penalty only through the term of the notice. We included long-term agreements for services and operating needs that only can be cancelled in the event of an uncured material breach or with a penalty through the entire term of the contract. Because of the uncertainties of seasonal demands and promotional calendar changes, our best estimate of usage for food, supplies and other operating needs and services is ratably over either the notice period or the remaining life of the contract, as applicable, unless we had better information available at the time related to each contract. |
(e) | Other long-term obligations include our Non-Qualified Savings Plan ($25,263, with a corresponding long-term asset to fund the liability; see Note 13 to the Consolidated Financial Statements), Deferred Compensation Plan ($3,276) and our long-term incentive plans ($8,777). |
(f) | Our standby letters of credit relate to securing reserved claims under workers’ compensation insurance and reduce our borrowing availability under the Revolving Credit Facility. |
(g)
|
Consists solely of guarantees associated with lease payments for two properties. We are not aware of any non-performance under these arrangements that would result in us having to perform in accordance with the terms of those guarantees.
|
· | management believes are most important to the accurate portrayal of both our financial condition and operating results; and |
· | require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. |
· | Impairment of Long-Lived Assets and Provision for Asset Dispositions |
· | Insurance Reserves |
· | Retail Inventory Valuation |
· | Tax Provision |
· | Share-Based Compensation |
· | The expected volatility is a blend of implied volatility based on market-traded options on our stock and historical volatility of our stock over the period commensurate with the three-year performance period. |
· | The risk-free interest rate is based on the U.S. Treasury rate assumption commensurate with the three-year performance period. |
· | The expected dividend yield is based on our current dividend yield as the best estimate of projected dividend yield for periods within the three-year performance period. |
Trade Date
|
Effective Date
|
Term
(in Years)
|
Notional Amount
|
Fixed
Rate
|
|||||||||
August 10, 2010
|
May 3, 2013
|
2
|
$
|
200,000
|
2.73
|
%
|
|||||||
July 25, 2011
|
May 3, 2013
|
2
|
50,000
|
2.00
|
%
|
||||||||
July 25, 2011
|
May 3, 2013
|
3
|
50,000
|
2.45
|
%
|
||||||||
September 19, 2011
|
May 3, 2013
|
2
|
25,000
|
1.05
|
%
|
||||||||
September 19, 2011
|
May 3, 2013
|
2
|
25,000
|
1.05
|
%
|
||||||||
December 7, 2011
|
May 3, 2013
|
3
|
50,000
|
1.40
|
%
|
||||||||
March 18, 2013
|
May 3, 2015
|
3
|
50,000
|
1.51
|
%
|
||||||||
April 8, 2013
|
May 3, 2015
|
2
|
50,000
|
1.05
|
%
|
||||||||
April 15, 2013
|
May 3, 2015
|
2
|
50,000
|
1.03
|
%
|
||||||||
April 22, 2013
|
May 3, 2015
|
3
|
25,000
|
1.30
|
%
|
||||||||
April 25, 2013
|
May 3, 2015
|
3
|
25,000
|
1.30
|
%
|
|
Percentage of Food Purchases
|
|||||||
|
2013
|
2012
|
||||||
Beef
|
13
|
%
|
12
|
%
|
||||
Dairy (including eggs)
|
12
|
%
|
13
|
%
|
||||
Fruits and vegetables
|
12
|
%
|
14
|
%
|
||||
Poultry
|
11
|
%
|
10
|
%
|
||||
Pork
|
11
|
%
|
10
|
%
|
CRACKER BARREL OLD COUNTRY STORE, INC.
|
|
CONSOLIDATED BALANCE SHEETS
|
|
(In thousands except share data)
|
|||||||
ASSETS
|
August 2, 2013
|
August 3, 2012
|
||||||
Current Assets:
|
|
|
||||||
Cash and cash equivalents
|
$
|
121,718
|
$
|
151,962
|
||||
Property held for sale
|
883
|
884
|
||||||
Accounts receivable
|
15,942
|
14,609
|
||||||
Inventories
|
146,687
|
143,267
|
||||||
Prepaid expenses and other current assets
|
12,648
|
11,405
|
||||||
Deferred income taxes
|
4,316
|
15,181
|
||||||
Total current assets
|
302,194
|
337,308
|
||||||
Property and Equipment:
|
||||||||
Land
|
299,995
|
296,500
|
||||||
Buildings and improvements
|
746,764
|
726,814
|
||||||
Buildings under capital leases
|
3,289
|
3,289
|
||||||
Restaurant and other equipment
|
484,013
|
458,370
|
||||||
Leasehold improvements
|
255,058
|
242,305
|
||||||
Construction in progress
|
8,704
|
14,293
|
||||||
Total
|
1,797,823
|
1,741,571
|
||||||
Less: Accumulated depreciation and amortization of capital leases
|
771,454
|
719,201
|
||||||
Property and equipment – net
|
1,026,369
|
1,022,370
|
||||||
Other assets
|
59,743
|
59,314
|
||||||
Total
|
$
|
1,388,306
|
$
|
1,418,992
|
||||
|
||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
Current Liabilities:
|
||||||||
Accounts payable
|
$
|
110,637
|
$
|
101,271
|
||||
Taxes withheld and accrued
|
35,076
|
39,704
|
||||||
Accrued employee compensation
|
62,780
|
66,923
|
||||||
Accrued employee benefits
|
24,477
|
26,546
|
||||||
Deferred revenues
|
44,098
|
37,696
|
||||||
Dividend payable
|
17,847
|
9,732
|
||||||
Current interest rate swap liability
|
--
|
20,215
|
||||||
Other current liabilities
|
21,152
|
16,972
|
||||||
Total current liabilities
|
316,067
|
319,059
|
||||||
Long-term debt
|
400,000
|
525,036
|
||||||
Long-term interest rate swap liability
|
11,644
|
14,166
|
||||||
Other long-term obligations
|
120,073
|
114,897
|
||||||
Deferred income taxes
|
56,496
|
63,159
|
||||||
Commitments and Contingencies (Notes 10 and 16)
|
||||||||
Shareholders’ Equity:
|
||||||||
Preferred stock – 100,000,000 shares of $.01 par value authorized; 300,000 shares designated as Series A Junior Participating Preferred Stock; no shares issued
|
--
|
--
|
||||||
Common stock – 400,000,000 shares of $.01 par value authorized; 2013 – 23,795,327 shares issued and outstanding; 2012 – 23,473,024
|
||||||||
shares issued and outstanding
|
237
|
234
|
||||||
Additional paid-in capital
|
51,728
|
28,676
|
||||||
Accumulated other comprehensive loss
|
(6,612
|
)
|
(21,158
|
)
|
||||
Retained earnings
|
438,673
|
374,923
|
||||||
Total shareholders’ equity
|
484,026
|
382,675
|
||||||
Total
|
$
|
1,388,306
|
$
|
1,418,992
|
CRACKER BARREL OLD COUNTRY STORE, INC.
|
|
CONSOLIDATED STATEMENTS OF INCOME
|
|
(In thousands except share data)
Fiscal years ended
|
|||||||||||
|
August 2, 2013
|
August 3, 2012
|
July 29, 2011
|
|||||||||
|
|
|
|
|||||||||
Total revenue
|
$
|
2,644,630
|
$
|
2,580,195
|
$
|
2,434,435
|
||||||
Cost of goods sold
|
854,684
|
827,484
|
772,471
|
|||||||||
Gross profit
|
1,789,946
|
1,752,711
|
1,661,964
|
|||||||||
Labor and other related expenses
|
962,559
|
951,435
|
904,229
|
|||||||||
Other store operating expenses
|
482,601
|
464,130
|
451,957
|
|||||||||
Store operating income
|
344,786
|
337,146
|
305,778
|
|||||||||
General and administrative expenses
|
143,262
|
146,171
|
139,222
|
|||||||||
Impairment and store dispositions, net
|
--
|
--
|
(625
|
)
|
||||||||
Operating income
|
201,524
|
190,975
|
167,181
|
|||||||||
Interest expense
|
35,742
|
44,687
|
51,490
|
|||||||||
Income before income taxes
|
165,782
|
146,288
|
115,691
|
|||||||||
Provision for income taxes
|
48,517
|
43,207
|
30,483
|
|||||||||
Net income
|
$
|
117,265
|
$
|
103,081
|
$
|
85,208
|
||||||
|
||||||||||||
Net income per share - basic
|
$
|
4.95
|
$
|
4.47
|
$
|
3.70
|
||||||
Net income per share - diluted
|
$
|
4.90
|
$
|
4.40
|
$
|
3.61
|
||||||
|
||||||||||||
Basic weighted average shares outstanding
|
23,708,875
|
23,067,566
|
22,998,200
|
|||||||||
Diluted weighted average shares outstanding
|
23,948,321
|
23,408,126
|
23,634,675
|
CRACKER BARREL OLD COUNTRY STORE, INC.
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
|
(In thousands)
Fiscal years ended
|
|||||||||||
|
August 2, 2013
|
August 3, 2012
|
July 29, 2011
|
|||||||||
|
|
|
|
|||||||||
Net income
|
$
|
117,265
|
$
|
103,081
|
$
|
85,208
|
||||||
|
||||||||||||
Other comprehensive income before income tax expense:
|
||||||||||||
Change in fair value of interest rate swaps
|
23,620
|
17,223
|
14,677
|
|||||||||
Income tax expense
|
9,074
|
349
|
3,860
|
|||||||||
Other comprehensive income, net of tax
|
14,546
|
16,874
|
10,817
|
|||||||||
Comprehensive income
|
$
|
131,811
|
$
|
119,955
|
$
|
96,025
|
|
Common Stock
|
Additional Paid-In
|
Accumulated Other Comprehensive
|
Retained
|
Total Shareholders’
|
|||||||||||||||||||
|
Shares
|
Amount
|
Capital
|
Loss
|
Earnings
|
Equity
|
||||||||||||||||||
Balances at July 30, 2010
|
22,732,781
|
$
|
228
|
$
|
6,200
|
$
|
(48,849
|
)
|
$
|
234,038
|
$
|
191,617
|
||||||||||||
Comprehensive Income:
|
||||||||||||||||||||||||
Net income
|
--
|
--
|
--
|
--
|
85,208
|
85,208
|
||||||||||||||||||
Other comprehensive income, net of tax
|
--
|
--
|
--
|
10,817
|
--
|
10,817
|
||||||||||||||||||
Total comprehensive income
|
--
|
--
|
--
|
10,817
|
85,208
|
96,025
|
||||||||||||||||||
Cash dividends declared - $.88 per share
|
--
|
--
|
--
|
--
|
(20,489
|
)
|
(20,489
|
)
|
||||||||||||||||
Share-based compensation
|
--
|
--
|
9,796
|
--
|
--
|
9,796
|
||||||||||||||||||
Exercise of share-based compensation awards
|
784,793
|
7
|
20,533
|
--
|
--
|
20,540
|
||||||||||||||||||
Tax benefit realized upon exercise of share-based compensation awards
|
--
|
--
|
4,108
|
--
|
--
|
4,108
|
||||||||||||||||||
Purchases and retirement of common stock
|
(676,600
|
)
|
(7
|
)
|
(33,556
|
)
|
--
|
--
|
(33,563
|
)
|
||||||||||||||
Balances at July 29, 2011
|
22,840,974
|
228
|
7,081
|
(38,032
|
)
|
298,757
|
268,034
|
|||||||||||||||||
Comprehensive Income:
|
||||||||||||||||||||||||
Net income
|
--
|
--
|
--
|
--
|
103,081
|
103,081
|
||||||||||||||||||
Other comprehensive income, net of tax
|
--
|
--
|
--
|
16,874
|
--
|
16,874
|
||||||||||||||||||
Total comprehensive income
|
--
|
--
|
--
|
16,874
|
103,081
|
119,955
|
||||||||||||||||||
Cash dividends declared - $1.15 per share
|
--
|
--
|
--
|
--
|
(26,915
|
)
|
(26,915
|
)
|
||||||||||||||||
Share-based compensation
|
--
|
--
|
14,420
|
--
|
--
|
14,420
|
||||||||||||||||||
Exercise of share-based compensation awards
|
897,588
|
9
|
17,593
|
--
|
--
|
17,602
|
||||||||||||||||||
Tax benefit realized upon exercise of share-based compensation awards
|
--
|
--
|
4,502
|
--
|
--
|
4,502
|
||||||||||||||||||
Purchases and retirement of common stock
|
(265,538
|
)
|
(3
|
)
|
(14,920
|
)
|
--
|
--
|
(14,923
|
)
|
||||||||||||||
Balances at August 3, 2012
|
23,473,024
|
234
|
28,676
|
(21,158
|
)
|
374,923
|
382,675
|
|||||||||||||||||
Comprehensive Income:
|
||||||||||||||||||||||||
Net income
|
--
|
--
|
--
|
--
|
117,265
|
117,265
|
||||||||||||||||||
Other comprehensive income, net of tax
|
--
|
--
|
--
|
14,546
|
--
|
14,546
|
||||||||||||||||||
Total comprehensive income
|
--
|
--
|
--
|
14,546
|
117,265
|
131,811
|
||||||||||||||||||
Cash dividends declared - $2.25 per share
|
--
|
--
|
--
|
--
|
(53,515
|
)
|
(53,515
|
)
|
||||||||||||||||
Share-based compensation
|
--
|
--
|
17,839
|
--
|
--
|
17,839
|
||||||||||||||||||
Exercise of share-based compensation awards
|
366,603
|
4
|
6,450
|
--
|
--
|
6,454
|
||||||||||||||||||
Tax benefit realized upon exercise of share-based compensation awards
|
--
|
--
|
2,332
|
--
|
--
|
2,332
|
||||||||||||||||||
Purchases and retirement of common stock
|
(44,300
|
)
|
(1
|
)
|
(3,569
|
)
|
--
|
--
|
(3,570
|
)
|
||||||||||||||
Balances at August 2, 2013
|
23,795,327
|
$
|
237
|
$
|
51,728
|
$
|
(6,612
|
)
|
$
|
438,673
|
$
|
484,026
|
CRACKER BARREL OLD COUNTRY STORE, INC.
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In thousands)
|
|||||||||||
|
Fiscal years ended
|
|||||||||||
|
August 2, 2013
|
August 3,2012
|
July 29, 2011
|
|||||||||
Cash flows from operating activities:
|
|
|
|
|||||||||
Net income
|
$
|
117,265
|
$
|
103,081
|
$
|
85,208
|
||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||
Depreciation and amortization
|
66,120
|
64,467
|
62,788
|
|||||||||
Loss (gain) on disposition of property and equipment
|
4,057
|
2,702
|
(1,418
|
)
|
||||||||
Impairment
|
--
|
--
|
3,219
|
|||||||||
Share-based compensation
|
17,839
|
14,420
|
9,796
|
|||||||||
Excess tax benefit from share-based compensation
|
(2,332
|
)
|
(4,502
|
)
|
(4,108
|
)
|
||||||
Changes in assets and liabilities:
|
||||||||||||
Accounts receivable
|
(1,333
|
)
|
(2,330
|
)
|
1,251
|
|||||||
Income taxes receivable
|
--
|
7,898
|
(7,898
|
)
|
||||||||
Inventories
|
(3,420
|
)
|
(1,720
|
)
|
2,532
|
|||||||
Prepaid expenses and other current assets
|
(1,243
|
)
|
(2,405
|
)
|
(391
|
)
|
||||||
Other assets
|
(1,033
|
)
|
(4,725
|
)
|
(803
|
)
|
||||||
Accounts payable
|
9,366
|
1,592
|
(16,539
|
)
|
||||||||
Taxes withheld and accrued
|
(4,628
|
)
|
7,369
|
(652
|
)
|
|||||||
Accrued employee compensation
|
(4,143
|
)
|
17,729
|
(10,680
|
)
|
|||||||
Accrued employee benefits
|
(2,069
|
)
|
(2,701
|
)
|
(1,690
|
)
|
||||||
Deferred revenues
|
6,402
|
5,066
|
5,086
|
|||||||||
Other current liabilities
|
6,628
|
2,651
|
(7,863
|
)
|
||||||||
Other long-term obligations
|
5,895
|
9,973
|
12,576
|
|||||||||
Deferred income taxes
|
(4,872
|
)
|
1,257
|
7,798
|
||||||||
Net cash provided by operating activities
|
208,499
|
219,822
|
138,212
|
|||||||||
Cash flows from investing activities:
|
||||||||||||
Purchase of property and equipment
|
(74,417
|
)
|
(80,922
|
)
|
(77,962
|
)
|
||||||
Proceeds from insurance recoveries of property and equipment
|
456
|
752
|
276
|
|||||||||
Proceeds from sale of property and equipment
|
555
|
623
|
8,197
|
|||||||||
Net cash used in investing activities
|
(73,406
|
)
|
(79,547
|
)
|
(69,489
|
)
|
||||||
Cash flows from financing activities:
|
||||||||||||
Proceeds from issuance of long-term debt
|
--
|
92,600
|
687,000
|
|||||||||
Proceeds from exercise of share-based compensation awards
|
6,454
|
17,602
|
20,540
|
|||||||||
Principal payments under long-term debt and other long-term obligations
|
(125,153
|
)
|
(117,733
|
)
|
(717,263
|
)
|
||||||
Purchases and retirement of common stock
|
(3,570
|
)
|
(14,923
|
)
|
(33,563
|
)
|
||||||
Deferred financing costs
|
--
|
(263
|
)
|
(5,125
|
)
|
|||||||
Dividends on common stock
|
(45,400
|
)
|
(22,372
|
)
|
(19,846
|
)
|
||||||
Excess tax benefit from share-based compensation
|
2,332
|
4,502
|
4,108
|
|||||||||
Net cash used in financing activities
|
(165,337
|
)
|
(40,587
|
)
|
(64,149
|
)
|
||||||
Net (decrease) increase in cash and cash equivalents
|
(30,244
|
)
|
99,688
|
4,574
|
||||||||
Cash and cash equivalents, beginning of year
|
151,962
|
52,274
|
47,700
|
|||||||||
Cash and cash equivalents, end of year
|
$
|
121,718
|
$
|
151,962
|
$
|
52,274
|
||||||
|
||||||||||||
Supplemental disclosure of cash flow information:
|
||||||||||||
Cash paid during the year for:
|
||||||||||||
Interest, net of amounts capitalized
|
$
|
29,959
|
$
|
50,357
|
$
|
46,301
|
||||||
Income taxes
|
47,550
|
18,768
|
32,248
|
|||||||||
Supplemental schedule of non-cash financing activity
|
||||||||||||
Change in fair value of interest rate swaps
|
$
|
23,620
|
$
|
17,223
|
$
|
14,677
|
||||||
Change in deferred tax asset for interest rate swaps
|
(9,074
|
)
|
(349
|
)
|
(3,860
|
)
|
||||||
Dividends declared but not yet paid
|
17,847
|
9,732
|
5,190
|
Years
|
||||
Buildings and improvements
|
30-45
|
|||
Buildings under capital leases
|
15-25
|
|||
Restaurant and other equipment
|
2-10
|
|||
Leasehold improvements
|
1-35
|
|
2013
|
2012
|
2011
|
|||||||||
Total depreciation expense
|
$
|
65,351
|
$
|
63,705
|
$
|
61,677
|
||||||
Depreciation expense related to store operations*
|
60,574
|
58,423
|
56,985
|
|
2013
|
2012
|
2011
|
|||||||||
Advertising expense
|
$
|
59,957
|
$
|
56,198
|
$
|
48,889
|
· | Quoted Prices in Active Markets for Identical Assets (“Level 1”) – quoted prices (unadjusted) for an identical asset or liability in an active market. |
· | Significant Other Observable Inputs (“Level 2”) – quoted prices for a similar asset or liability in an active market or model-derived valuations in which all significant inputs are observable for substantially the full term of the asset or liability. |
· | Significant Unobservable Inputs (“Level 3”) – unobservable and significant to the fair value measurement of the asset or liability. |
|
Level 1
|
Level 2
|
Level 3
|
Fair Value as of August 2, 2013
|
||||||||||||
Cash equivalents*
|
$
|
57,767
|
$
|
--
|
$
|
--
|
$
|
57,767
|
||||||||
Interest rate swap asset (see Note 6)
|
--
|
883
|
--
|
883
|
||||||||||||
Deferred compensation plan assets**
|
25,263
|
--
|
--
|
25,263
|
||||||||||||
Total assets at fair value
|
$
|
83,030
|
$
|
883
|
$
|
--
|
$
|
83,913
|
||||||||
|
||||||||||||||||
Interest rate swap liability (see Note 6)
|
$
|
--
|
$
|
11,644
|
$
|
--
|
$
|
11,644
|
||||||||
Total liabilities at fair value
|
$
|
--
|
$
|
11,644
|
$
|
--
|
$
|
11,644
|
|
Level 1
|
Level 2
|
Level 3
|
Fair Value as of August 3, 2012
|
||||||||||||
Cash equivalents*
|
$
|
104,531
|
$
|
--
|
$
|
--
|
$
|
104,531
|
||||||||
Interest rate swap asset (see Note 6)
|
--
|
--
|
--
|
--
|
||||||||||||
Deferred compensation plan assets**
|
29,443
|
--
|
--
|
29,443
|
||||||||||||
Total assets at fair value
|
$
|
133,974
|
$
|
--
|
$
|
--
|
$
|
133,974
|
||||||||
|
||||||||||||||||
Interest rate swap liability (see Note 6)
|
$
|
--
|
$
|
34,381
|
$
|
--
|
$
|
34,381
|
||||||||
Total liabilities at fair value
|
$
|
--
|
$
|
34,381
|
$
|
--
|
$
|
34,381
|
|
August 2, 2013
|
August 3, 2012
|
||||||
Retail
|
$
|
112,736
|
$
|
108,846
|
||||
Restaurant
|
20,214
|
19,728
|
||||||
Supplies
|
13,737
|
14,693
|
||||||
Total
|
$
|
146,687
|
$
|
143,267
|
|
August 2, 2013
|
August 3, 2012
|
||||||
Revolving Credit Facility expiring on July 8, 2016
|
$
|
212,500
|
$
|
312,500
|
||||
Term loan payable on or before July 8, 2016
|
187,500
|
212,500
|
||||||
Note payable
|
--
|
142
|
||||||
400,000
|
525,142
|
|||||||
Current maturities
|
--
|
(106
|
)
|
|||||
Long-term debt
|
$
|
400,000
|
$
|
525,036
|
Year
|
|
|||
2014
|
$
|
--
|
||
2015
|
25,000
|
|||
2016
|
375,000
|
|||
Total
|
$
|
400,000
|
Trade Date
|
Effective Date
|
Term
(in Years)
|
Notional Amount
|
Fixed
Rate
|
|||||||||
August 10, 2010
|
May 3, 2013
|
2
|
$
|
200,000
|
2.73
|
%
|
|||||||
July 25, 2011
|
May 3, 2013
|
2
|
50,000
|
2.00
|
%
|
||||||||
July 25, 2011
|
May 3, 2013
|
3
|
50,000
|
2.45
|
%
|
||||||||
September 19, 2011
|
May 3, 2013
|
2
|
25,000
|
1.05
|
%
|
||||||||
September 19, 2011
|
May 3, 2013
|
2
|
25,000
|
1.05
|
%
|
||||||||
December 7, 2011
|
May 3, 2013
|
3
|
50,000
|
1.40
|
%
|
||||||||
March 18, 2013
|
May 3, 2015
|
3
|
50,000
|
1.51
|
%
|
||||||||
April 8, 2013
|
May 3, 2015
|
2
|
50,000
|
1.05
|
%
|
||||||||
April 15, 2013
|
May 3, 2015
|
2
|
50,000
|
1.03
|
%
|
||||||||
April 22, 2013
|
May 3, 2015
|
3
|
25,000
|
1.30
|
%
|
||||||||
April 25, 2013
|
May 3, 2015
|
3
|
25,000
|
1.30
|
%
|
(See Note 3)
|
Balance Sheet Location
|
August 2, 2013
|
August 3, 2012
|
||||||
Interest rate swaps
|
Other assets
|
$
|
883
|
$
|
--
|
||||
Interest rate swap
|
Current interest rate swap liability
|
$
|
--
|
$
|
20,215
|
||||
Interest rate swaps
|
Long-term interest rate swap liability
|
11,644
|
14,166
|
||||||
Total liabilities
|
|
$
|
11,644
|
$
|
34,381
|
|
Amount of Income Recognized in AOCL on Derivatives (Effective Portion)
|
|||||||||||
|
2013
|
2012
|
2011
|
|||||||||
Cash flow hedges:
|
|
|
|
|||||||||
Interest rate swaps
|
$
|
23,620
|
$
|
17,223
|
$
|
14,677
|
|
2013
|
2012
|
2011
|
|||||||||
Maximum aggregate purchase price
|
$
|
100,000
|
$
|
65,000
|
$
|
65,000
|
||||||
Cost of shares repurchased
|
$
|
3,570
|
$
|
14,923
|
$
|
33,563
|
||||||
Shares of common stock repurchased
|
44,300
|
265,538
|
676,600
|
|
2013
|
2012
|
2011
|
|||||||||
Restaurant
|
$
|
2,104,768
|
$
|
2,054,127
|
$
|
1,934,049
|
||||||
Retail
|
539,862
|
526,068
|
500,386
|
|||||||||
Total revenue
|
$
|
2,644,630
|
$
|
2,580,195
|
$
|
2,434,435
|
|
2013
|
2012
|
2011
|
|||||||||
Impairment
|
$
|
--
|
$
|
--
|
$
|
3,219
|
||||||
Gains on disposition of stores
|
--
|
--
|
(4,109
|
)
|
||||||||
Store closing costs
|
--
|
--
|
265
|
|||||||||
Total
|
$
|
--
|
$
|
--
|
$
|
(625
|
)
|
Year
|
Minimum
|
Contingent
|
Total
|
|||||||||
2013
|
$
|
70,095
|
$
|
232
|
$
|
70,327
|
||||||
2012
|
67,651
|
276
|
67,927
|
|||||||||
2011
|
65,878
|
179
|
66,057
|
Year
|
Total
|
|||
2014
|
$
|
59,075
|
||
2015
|
47,030
|
|||
2016
|
42,316
|
|||
2017
|
40,324
|
|||
2018
|
40,716
|
|||
Later years
|
536,983
|
|||
Total
|
$
|
766,444
|
2010 Omnibus Plan
|
390,759
|
|||
2000 Non-Executive Stock Option Plan
|
12,083
|
|||
Amended and Restated Stock Option Plan
|
43,107
|
|||
2002 Omnibus Incentive Compensation Plan
|
50,948
|
|||
Total
|
496,897
|
Long-Term Performance Plan (“LTPP”)
|
Performance Period
|
Vesting Period
(in Years)
|
||||||
2012 LTPP
|
2012 - 2013
|
2
|
||||||
2013 LTPP |
2013 - 2014
|
2 or 3
|
|
|
|||
2012 LTPP
|
157,356
|
|||
2013 LTPP
|
36,436
|
|
|
|||||||
Nonvested Stock
|
Shares
|
Weighted-Average
Grant Date Fair
Value
|
||||||
Unvested at August 3, 2012
|
80,190
|
$
|
41.97
|
|||||
Granted
|
134,145
|
67.68
|
||||||
Vested
|
(130,481
|
)
|
57.06
|
|||||
Forfeited
|
(1,000
|
)
|
42.21
|
|||||
Unvested at August 2, 2013
|
82,854
|
$
|
59.83
|
|
2013
|
2012
|
2011
|
|||||||||
Total fair value of nonvested stock
|
$
|
7,445
|
$
|
12,981
|
$
|
4,393
|
· | The expected volatility is a blend of implied volatility based on market-traded options on our stock and historical volatility of our stock over the period commensurate with the three-year performance period. |
· | The risk-free interest rate is based on the U.S. Treasury rate assumption commensurate with the three-year performance period. |
· | The expected dividend yield is based on our current dividend yield as the best estimate of projected dividend yield for periods within the three-year performance period. |
|
|
Year Ended
|
|
|||||||||
|
August 2, 2013
|
August 3, 2012
|
July 29, 2011
|
|||||||||
Dividend yield range
|
3.0
|
%
|
2.2
|
%
|
1.6
|
%
|
||||||
Expected volatility
|
27
|
%
|
45
|
%
|
43
|
%
|
||||||
Risk-free interest rate
|
0.3
|
%
|
0.3
|
%
|
0.8
|
%
|
|
Shares
|
|||
2011 MSU Grants
|
41,963
|
|||
2012 MSU Grants
|
56,301
|
|||
2013 MSU Grants
|
20,849
|
|
Year Ended
|
|||
|
July 29, 2011*
|
|||
Dividend yield range
|
1.7
|
%
|
||
Expected volatility
|
40
|
%
|
||
Risk-free interest rate range
|
0.3%- 4.6
|
%
|
||
Expected term (in years)
|
6.6
|
*
|
|
|
|
||||||||||||||
Fixed Options
|
Shares
|
Weighted-
Average
Price
|
Weighted-Average
Remaining
Contractual Term
|
Aggregate
Intrinsic
Value
|
||||||||||||
Outstanding at August 3, 2012
|
403,957
|
$
|
33.22
|
|
|
|||||||||||
Granted
|
--
|
--
|
|
|
||||||||||||
Exercised
|
(273,706
|
)
|
32.66
|
|
|
|||||||||||
Forfeited
|
--
|
--
|
|
|
||||||||||||
Canceled
|
(29,113
|
)
|
24.98
|
|
|
|||||||||||
Outstanding at August 2, 2013
|
101,138
|
$
|
37.12
|
2.61
|
$
|
6,455
|
||||||||||
Exercisable
|
101,138
|
$
|
37.12
|
2.61
|
$
|
6,455
|
|
2013
|
2012
|
2011
|
|||||||||
Weighted-average grant-date fair values of options granted
|
$
|
--
|
$
|
--
|
$
|
16.81
|
||||||
Total intrinsic values of options exercised*
|
10,526
|
14,859
|
11,713
|
|
2013
|
2012
|
2011
|
|||||||||
Nonvested stock awards
|
$
|
15,416
|
$
|
11,440
|
$
|
6,652
|
||||||
MSU Grants
|
2,335
|
1,690
|
989
|
|||||||||
Stock options
|
88
|
1,290
|
2,155
|
|||||||||
Total compensation expense
|
$
|
17,839
|
$
|
14,420
|
$
|
9,796
|
|
Nonvested Stock
|
Stock Options
|
MSU Grants
|
|||||||||
Total unrecognized compensation
|
$
|
3,122
|
$
|
--
|
$
|
2,216
|
||||||
Weighted-average period in years
|
2.41
|
--
|
1.73
|
|
2013
|
2012
|
2011
|
|||||||||
Total income tax benefit
|
$
|
5,221
|
$
|
4,254
|
$
|
2,576
|
· | will not be redeemable. |
· | will entitle holders to quarterly dividend payments of $0.01 per share, or an amount equal to the dividend paid on one share of common stock, whichever is greater. |
· | will entitle holders upon liquidation either to receive $1.00 per share or an amount equal to the payment made on one share of common stock, whichever is greater. |
· | will have the same voting power as one share of common stock. |
· | if shares of the Company’s common stock are exchanged via merger, consolidation, or a similar transaction, will entitle holders to a per share payment equal to the payment made on one share of common stock. |
|
2013
|
2012
|
2011
|
|||||||||
401(k) Savings Plan
|
$
|
2,180
|
$
|
2,026
|
$
|
1,986
|
||||||
Non-Qualified Savings Plan
|
241
|
283
|
388
|
|
2013
|
2012
|
2011
|
|||||||||
Current:
|
|
|
|
|||||||||
Federal
|
$
|
44,853
|
$
|
34,074
|
$
|
17,231
|
||||||
State
|
4,375
|
7,928
|
5,577
|
|||||||||
Deferred:
|
||||||||||||
Federal
|
(4,365
|
)
|
886
|
9,019
|
||||||||
State
|
3,654
|
319
|
(1,344
|
)
|
||||||||
Total provision for income taxes
|
$
|
48,517
|
$
|
43,207
|
$
|
30,483
|
2013
|
2012
|
2011
|
||||||||||
Provision computed at federal statutory income tax rate
|
$
|
58,024
|
$
|
51,201
|
$
|
40,492
|
||||||
State and local income taxes, net of federal benefit
|
5,698
|
6,424
|
3,050
|
|||||||||
Employer tax credits for FICA taxes paid on employee tip income
|
(9,635
|
)
|
(9,114
|
)
|
(8,351
|
)
|
||||||
Other employer tax credits
|
(5,927
|
)
|
(4,938
|
)
|
(5,098
|
)
|
||||||
Other-net
|
357
|
(366
|
)
|
390
|
||||||||
Total provision for income taxes
|
$
|
48,517
|
$
|
43,207
|
$
|
30,483
|
|
August 2, 2013
|
August 3, 2012
|
||||||
Deferred tax assets:
|
|
|
||||||
Compensation and employee benefits
|
$
|
16,750
|
$
|
14,803
|
||||
Deferred rent
|
13,535
|
12,162
|
||||||
Accrued liabilities
|
12,766
|
12,988
|
||||||
Insurance reserves
|
12,091
|
12,308
|
||||||
Inventory
|
5,669
|
5,293
|
||||||
Other
|
4,437
|
13,609
|
||||||
Deferred tax assets
|
$
|
65,248
|
$
|
71,163
|
||||
Deferred tax liabilities:
|
||||||||
Property and equipment
|
$
|
94,179
|
$
|
96,783
|
||||
Inventory
|
13,700
|
12,956
|
||||||
Other
|
9,550
|
9,402
|
||||||
Deferred tax liabilities
|
117,429
|
119,141
|
||||||
Net deferred tax liability
|
$
|
52,181
|
$
|
47,978
|
|
August 2, 2013
|
August 3, 2012
|
July 29, 2011
|
|||||||||
Balance at beginning of year
|
$
|
18,098
|
$
|
14,167
|
$
|
12,965
|
||||||
Tax positions related to the current year: | ||||||||||||
Additions
|
3,731
|
3,326
|
2,616
|
|||||||||
Reductions
|
--
|
--
|
--
|
|||||||||
Tax positions related to the prior year:
|
||||||||||||
Additions |
191
|
2,556
|
987
|
|||||||||
Reductions
|
(280
|
)
|
(1,043
|
)
|
(24
|
)
|
||||||
Settlements
|
--
|
--
|
--
|
|||||||||
Expiration of statute of limitations
|
(768
|
)
|
(908
|
)
|
(2,377
|
)
|
||||||
Balance at end of year
|
$
|
20,972
|
$
|
18,098
|
$
|
14,167
|
|
2013
|
2012
|
2011
|
|||||||||
Uncertain tax positions
|
$
|
13,631
|
$
|
11,764
|
$
|
9,209
|
2013
|
2012
|
2011
|
||||||||||
Net income per share numerator
|
$
|
117,265
|
$
|
103,081
|
$
|
85,208
|
||||||
|
||||||||||||
Net income per share denominator:
|
||||||||||||
Basic weighted average shares outstanding
|
23,708,875
|
23,067,566
|
22,998,200
|
|||||||||
Add potential dilution:
|
||||||||||||
Stock options, nonvested stock awards and MSU Grants
|
239,446
|
340,560
|
636,475
|
|||||||||
Diluted weighted average shares outstanding
|
23,948,321
|
23,408,126
|
23,634,675
|
1
st
Quarter
|
2
nd
Quarter
|
3
rd
Quarter
|
4
th
Quarter
(a)
|
|||||||||||||
2013
|
||||||||||||||||
Total revenue
|
$
|
627,451
|
$
|
702,671
|
$
|
640,407
|
$
|
674,101
|
||||||||
Gross profit
|
429,593
|
458,484
|
438,425
|
463,444
|
||||||||||||
Income before income taxes
|
34,596
|
46,904
|
33,978
|
50,304
|
||||||||||||
Net income
|
23,192
|
35,168
|
24,602
|
34,303
|
||||||||||||
Net income per share – basic
|
$
|
0.98
|
$
|
1.48
|
$
|
1.04
|
$
|
1.44
|
||||||||
Net income per share – diluted
|
$
|
0.97
|
$
|
1.47
|
$
|
1.02
|
$
|
1.43
|
||||||||
2012
|
||||||||||||||||
Total revenue
|
$
|
598,437
|
$
|
673,234
|
$
|
608,514
|
$
|
700,010
|
||||||||
Gross profit
|
412,130
|
437,843
|
418,899
|
483,839
|
||||||||||||
Income before income taxes
|
33,489
|
36,312
|
27,935
|
48,552
|
||||||||||||
Net income
|
23,802
|
25,609
|
18,974
|
34,696
|
||||||||||||
Net income per share – basic
|
$
|
1.04
|
$
|
1.11
|
$
|
0.82
|
$
|
1.49
|
||||||||
Net income per share – diluted
|
$
|
1.03
|
$
|
1.10
|
$
|
0.81
|
$
|
1.47
|
|
/s/Sandra B. Cochran
|
|
Sandra B. Cochran
|
|
President and Chief Executive Officer
|
|
|
|
/s/Lawrence E. Hyatt
|
|
Lawrence E. Hyatt
|
|
Senior Vice President and Chief Financial Officer
|
1.
|
All financial statements – see Item 8.
|
2.
|
All schedules have been omitted since they are either not required or not applicable, or the required information is included.
|
3.
|
The exhibits listed in the accompanying Index to Exhibits immediately following the signature page to this Annual Report on Form 10-K.
|
|
|
CRACKER BARREL OLD COUNTRY STORE, INC.
|
|
|
|
|
By:
|
/s/Sandra B. Cochran
|
|
|
Sandra B. Cochran,
|
|
|
President and Chief Executive Officer
|
Name
|
Title
|
|
|
/s/Sandra B. Cochran
Sandra B. Cochran
|
President, Chief Executive Officer and Director
|
|
|
/s/Lawrence E. Hyatt
Lawrence E. Hyatt
|
Senior Vice President and Chief Financial Officer (Principal Financial Officer)
|
|
|
/s/P. Douglas Couvillion
P. Douglas Couvillion
|
Vice President, Corporate Controller (Principal Accounting Officer)
|
|
|
/s/Thomas H. Barr
Thomas H. Barr
|
Director
|
|
|
/s/James W. Bradford
James W. Bradford
|
Director and Chairman of the Board
|
|
|
/s/Glenn A. Davenport
Glenn A. Davenport
|
Director
|
|
|
/s/Richard J. Dobkin
Richard J. Dobkin
|
Director
|
|
|
/s/Norman E. Johnson
Norman E. Johnson
|
Director
|
|
|
/s/William W. McCarten
William W. McCarten
|
Director
|
|
|
/s/Martha M. Mitchell
Martha M. Mitchell
|
Director
|
|
|
/s/Coleman H. Peterson
Coleman H. Peterson
|
Director
|
/s/Andrea M. Weiss
Andrea M. Weiss
|
Director
|
3(I), 4(a)
|
Amended and Restated Charter of Cracker Barrel Old Country Store, Inc. (1)
|
|
|
|
|
3(II), 4(b)
|
Amended and Restated Bylaws of Cracker Barrel Old Country Store, Inc. (2)
|
|
|
|
|
4(c), 10(a)
|
Credit Agreement, dated as of July 8, 2011, among Cracker Barrel Old Country Store, Inc., the Subsidiary Guarantors named therein, the Lenders party thereto, and Wells Fargo Bank, National Association as Administrative Agent and Collateral Agent (3)
|
|
|
|
|
4(d)
|
Rights Agreement, dated as of April 9, 2012, between Cracker Barrel Old Country Store, Inc. and American Stock Transfer & Trust Company, LLC, as rights agent (4)
|
|
|
|
|
4(e), 10(b)
|
First Amendment to Credit Agreement, dated as of April 24, 2012 (5)
|
|
|
|
|
4(f), 10(c)
|
Second Amendment to Credit Agreement, dated as of May 31, 2013 (6)
|
|
|
|
|
10(d)
|
CBRL Group, Inc. 2000 Non-Executive Stock Option Plan
†
(7)
|
|
|
|
|
10(e)
|
Cracker Barrel Old Country Store, Inc. 1989 Stock Option Plan for Non‑Employee Directors
†
(8)
|
|
|
|
|
10(f)
|
CBRL Group, Inc. Form of Restricted Stock Award Notice
†
(9)
|
|
|
|
|
10(g)
|
Form of Stock Option Award under the CBRL Group, Inc. 2002 Omnibus Incentive Compensation Plan
†
(10)
|
|
|
|
|
10(h)
|
Change in Control Agreement with Edward A. Greene, dated June 22, 2006, as amended May 22, 2012
†
(11)
|
|
|
|
|
10(i)
|
Change in Control Agreement with Douglas E. Barber, dated April 23, 2008, as amended May 22, 2012
†
(12)
|
|
|
|
|
10(j)
|
Change in Control Agreement with Christopher A. Ciavarra, dated February 1, 2010, as amended May 22, 2012
†*
|
|
|
|
|
10(k)
|
Form of Change in Control Agreement with Lawrence E. Hyatt, effective January 3, 2011, as amended May 22, 2012
†
(13)
|
|
|
|
|
10(l)
|
Form of Change in Control and Severance Agreement between Cracker Barrel Old Country Store, Inc. and certain of its named officers
†
(14)
|
|
|
|
|
10(m)
|
Schedule identifying material differences among the Change in Control and Severance Agreements
†
(15)
|
|
|
|
|
10(n)
|
Master Lease, dated July 21, 2000, between Country Stores Property I, LLC, as Lessor, and Cracker Barrel Old Country Store, Inc., as Lessee, for lease of 21 Cracker Barrel Old Country Store® sites (16)
|
|
|
|
|
10(o)
|
Master Lease, dated July 31, 2000, between Country Stores Property I, LLC, as Lessor, and Cracker Barrel Old Country Store, Inc., as Lessee, for lease of 9 Cracker Barrel Old Country Store® sites**
|
|
|
|
|
10(p)
|
Master Lease, dated July 31, 2000, between Country Stores Property II, LLC, as Lessor, and Cracker Barrel Old Country Store, Inc., as Lessee, for lease of 23 Cracker Barrel Old Country Store® sites**
|
(1)
|
Incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K filed under the Exchange Act on April 10, 2012.
|
|
|
(2)
|
Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on February 24, 2012.
|
|
|
(3)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on July 11, 2011.
|
|
|
(4)
|
Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on April 10, 2012.
|
|
|
(5)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on April 26, 2012.
|
|
|
(6)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed under the Exchange Act for the quarterly period ended May 3, 2013.
|
|
|
(7)
|
Incorporated by reference to Exhibit 10(i) to the Company’s Annual Report on Form 10-K filed under the Exchange Act for the fiscal year ended August 2, 2002.
|
|
|
(8)
|
Incorporated by reference to Exhibit 10.4 to the Company’s Post Effective Amendment No. 1 to Form S-8 filed on January 17, 2012.
|
|
|
(9)
|
Incorporated by reference to Exhibit 10(j) to the Company’s Annual Report on Form 10-K filed under the Exchange Act for fiscal year ended July 29, 2005.
|
(10)
|
Incorporated by reference to Exhibit 10(l) to the Company’s Annual Report on Form 10-K filed under the Exchange Act for fiscal year ended July 29, 2005.
|
|
|
(11)
|
Incorporated by reference to Exhibit 10.2 to the Company’s Annual Report on Form 10-K filed under the Exchange Act for the fiscal year ended July 28, 2006.
|
|
|
(12)
|
Incorporated by reference to Exhibit 10(o) to the Company’s Annual Report on Form 10-K filed under the Exchange Act for the fiscal year ended August 1, 2008.
|
|
|
(13)
|
Incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on December 17, 2010.
|
|
|
(14)
|
Incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed under the Exchange Act for the quarterly period ended April 27, 2012.
|
|
|
(15)
|
Incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed under the Exchange Act for the quarterly period ended April 27, 2012.
|
|
|
(16)
|
Incorporated by reference to Exhibit 10.R to the Company’s Annual Report on Form 10-K filed under the Exchange Act for the fiscal year ended July 28, 2000.
|
|
|
(17)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed under the Exchange Act for the quarterly period ended January 30, 2009.
|
|
|
(18)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed under the Exchange Act for the quarterly period ended May 1, 2009.
|
|
|
(19)
|
Incorporated by reference to Exhibit 10(o) to the Company’s Annual Report on Form 10-K filed under the Exchange Act for the fiscal year ended July 29, 2011.
|
|
|
(20)
|
Incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed under the Exchange Act for the quarterly period ended January 29, 2010.
|
|
|
(21)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed under the Exchange Act for the quarterly period ended October 29, 2010.
|
|
|
(22)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on December 7, 2010.
|
|
|
(23)
|
Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed under the Exchange Act on December 7, 2010.
|
|
|
(24)
|
Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed under the Exchange Act on August 2, 2011.
|
|
|
(25)
|
Incorporated by reference to Exhibit 10(aa) to the Company’s Annual Report on Form 10-K filed under the Exchange Act for the fiscal year ended July 29, 2011.
|
|
|
(26)
|
Incorporated by reference to Exhibit 10(bb) to the Company’s Annual Report on Form 10-K filed under the Exchange Act for the fiscal year ended July 29, 2011.
|
|
|
(27)
|
Incorporated by reference to Exhibit 10(cc) to the Company’s Annual Report on Form 10-K filed under the Exchange Act for the fiscal year ended July 29, 2011.
|
|
|
(28)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on September 15, 2011.
|
(29)
|
Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed under the Exchange Act on September 15, 2011.
|
|
|
(30)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on August 6, 2012.
|
|
|
(31)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on October 3, 2012.
|
|
|
(32)
|
Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed under the Exchange Act on October 3, 2012.
|
|
|
(33)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed under the Exchange Act on July 31, 2013.
|
|
|
(34)
|
Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed under the Exchange Act on July 31, 2013.
|
|
|
(35)
|
Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed under the Exchange Act on July 31, 2013.
|
(a)
|
If either the Company or Executive do not intend to continue Executive’s employment with the Company in the capacity of Chief Executive Officer beyond the Expiration Date, such party shall, at least 180
days prior to such date, provide to the other party written notice of its or her intention not to continue her employment in such capacity.
|
(b)
|
If the Company ceases to employ Executive in the capacity of Chief Executive Officer at any time on or after the Expiration Date, for any reason other than on account of Cause, then the Company shall pay Executive an amount equal to 1.5 times Base Salary (as defined in
Section 4.1
) in effect on the Expiration Date, or, if greater, the Base Salary in effect immediately prior to the Executive’s last day of employment, which amount shall be paid to Executive in equal installments ratably over 18 months, as measured from Executive’s last day of employment with the Company (whether or not such termination of employment occurs contemporaneously with Executive’s ceasing to serve as the Company’s Chief Executive Officer), and commence to be paid to Executive, unless delay is required pursuant to clause (b) of
Section 15.8
, on the first regularly scheduled Company payroll date for Peer Executives (as defined in
Section 4.2
) that occurs after the 30th day from Executive’s last day of employment with the Company, which payment will include amounts owed to Executive for the period between Executive’s last day of employment with the Company and the payment date, and the remaining installments shall be paid to Executive in accordance with the Company’s regularly scheduled payroll cycles for Peer Executives over the remainder of such 18-month period;
provided
, that to receive the payments described in this clause (b) of
Section 2.2
Executive has executed and delivered the release attached hereto as an addendum and made a part hereof (the “
Release
”) and any revocation period applicable to such Release shall have expired as of the end of such 30-day period. Any payments made under this clause (b) of
Section 2.2
shall reduce the payments to which the Executive may be entitled to receive pursuant to the Company’s severance plan or policy then in effect for Peer Executives. In addition, if (i) (A) prior to the Expiration Date, there occurs a “Change in Control” (as defined in
Section 10.3
) or (B) following the Expiration Date, there occurs a “Change in Control” within the meaning of the Change in Control and Severance Agreement, of even date herewith and effective as of the Expiration Date (the “Post Employment Agreement Severance Agreement”) and (ii) the Executive’s employment terminates within the 90-day period before or the two-year period following such a Change in Control, then the Executive’s severance entitlements shall not be determined pursuant to this
Section 2.2(b)
, but instead shall be determined pursuant to
Section 10
(in the case of clause (i)(A) above) or pursuant to the Post Employment Agreement Severance (in the case of clause (i)(B) above).
|
(a)
|
Annual Incentive Award
. Executive shall be entitled to an annual bonus opportunity, the amount of which shall be determined by the Compensation Committee of the Board (the “
Committee
”). The amount of and performance criteria with respect to any such bonus in any year shall be determined not later than the date or time prescribed by Treas. Reg. § 1.162-27(e) in accordance with a formula to be agreed upon by the Company and Executive and approved by the Committee that reflects the financial and other performance of the Company and the Executive’s contributions thereto. Throughout the Term, the Executive’s annual target (subject to such performance and other criteria as may be established by the Committee) bonus percentage shall be no less than 100% of the Base Salary.
|
(b)
|
Long Term Incentive Award
. Each year, the Executive shall be considered by the Committee for a long term incentive award (an “LTI Award”), and any such award shall have a target grant date value equal to no less than 340% of the Base Salary. A grant of an LTI Award in any year shall be in the discretion of the Committee, provided that the Committee shall be required to grant the Executive an LTI Award if LTI Awards are being made for such year to other senior executives of the Company generally.
|
(c)
|
Welfare Benefit Plans
. During the Term, Executive and Executive’s eligible dependents shall be eligible for participation in, and shall receive all benefits under, the welfare benefit plans, practices, policies and programs provided by the Company (including, without limitation, medical, prescription, dental, disability, executive life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to Peer Executives. Also, throughout the Term, in addition to participating in the other insurance programs provided to Peer Executives, the Company, for the benefit of Executive, shall pay the premiums to maintain in force during the Term a policy of term life insurance covering the Executive, with such carrier as is reasonably acceptable to the Company and Executive, in the face amount of $2.5 million, with benefits payable to the beneficiary or beneficiaries designated by Executive in writing.
|
(d)
|
Vacation
. Executive shall be entitled to an annual paid vacation commensurate with the Company’s established vacation policy for Peer Executives. The timing of paid vacations shall be scheduled in a reasonable manner by Executive.
|
(e)
|
Business Expenses
. The Company shall reimburse Executive for all reasonable business expenses incurred by Executive during the Term in the performance of Executive’s services under this Agreement. Executive shall follow the Company’s expense procedures that generally apply to Peer Executives in accordance with the policies, practices and procedures of the Company to the extent applicable generally to Peer Executives.
|
(f)
|
Perquisites
. Executive shall be entitled to receive such executive perquisites, fringe and other benefits as are provided to the most senior executives and their families under any of the Company’s plans and/or programs in effect from time to time and such other benefits as are generally available to Peer Executives.
|
(g)
|
Legal Fees
. The Company shall pay up to $30,000 in legal fees and out-of-pocket expenses incurred by Executive in connection with the negotiation and consummation of this Agreement.
|
(h)
|
Clawback of Incentive-Based Compensation
. Notwithstanding any other provision to the contrary, any “incentive-based compensation” within the meaning of Section 10D of the Securities Exchange Act of 1934, as amended (the “
Exchange Act
”), will be subject to the Company’s clawback policy that is adopted in the manner required by Section 10D(b)(2) of the Exchange Act, as determined by the applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission.
|
(a)
|
(1) any act by Executive involving fraud, (2) any breach by Executive of applicable regulations of competent authorities in relation to trading or dealing with stocks, securities, investments and the like or (3) any willful or grossly negligent act by Executive resulting in an investigation by the Securities and Exchange Commission, which, in each of cases (1), (2) and (3) above, a majority of the Board determines in its sole and absolute discretion materially adversely affects the Company or Executive’s ability to perform her duties under this Agreement;
|
(b)
|
attendance at work in a state of intoxication or otherwise being found in possession at her place of work of any prohibited drug or substance, possession of which would amount to a criminal offense;
|
(c)
|
Executive’s personal dishonesty or willful misconduct in connection with her duties to the Company;
|
(d)
|
breach of fiduciary duties to the Company involving personal profit by Executive;
|
(e)
|
conviction of Executive for, or Executive pleading guilty or no contest to, any felony or crime involving moral turpitude;
|
(f)
|
material breach by Executive of any provision of this Agreement or of any Company policy adopted by the Board, which breach Executive does not cure within
15
days after the Company provides written notice of such breach to Executive; or
|
(g)
|
the continued failure, following written notice (as noted below) and a 30 day cure period, of Executive to perform substantially Executive’s duties with the Company (other than any such failure resulting from incapacity due to Disability, and specifically excluding any failure by Executive, after good faith, reasonable and demonstrable efforts, to meet performance expectations for any reason), after a written demand for substantial performance is delivered to Executive by a majority of the Board that specifically identifies the manner in which such Board believes that Executive has not substantially performed Executive’s duties.
|
(a)
|
other than her removal for Cause pursuant to
Section 5
and subject to the provisos below, without the prior written consent of Executive, the assignment to Executive of any duties inconsistent in any material respect with Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as in effect on the Effective Date, or any other action by the Company which results in a demonstrable diminution in such position, authority, duties or responsibilities;
provided
,
however
, that an isolated, insubstantial and inadvertent action not taken in bad faith, which is remedied by the Company promptly after receipt of written notice thereof given by Executive, shall not constitute “Good Reason”; and
provided
further
, that the Company may elect at any time to name another executive to the position of President (reporting to Executive), and such action shall not be a violation of this subparagraph 8.2(a) giving rise to “Good Reason”;
|
(b)
|
a reduction by the Company in Executive’s Base Salary as in effect on the Effective Date or as the same may be increased from time to time, unless such reduction is a part of an across-the-board proportional decrease in base salaries affecting all Peer Executives which reduction is approved by the Committee;
provided
,
however
, that in any event, the Company shall not reduce Executive’s Base Salary below 90% of the Base Salary as in effect on the Effective Date;
|
(c)
|
a reduction by the Company in Executive’s (1) annual target bonus percentage to which Executive is entitled pursuant to
Section 4.2(a)
or (2) target percentage under any long-term incentive plan established by the Company to which Executive is entitled pursuant to
Section 4.2(b)
, unless, in either case (1) or (2), such reduction is a part of an across-the-board proportional
decrease in annual target bonuses percentages or target percentages under any long-term incentive plan, as applicable, affecting all other Peer Executives, which reduction is approved by the Committee;
provided
,
however
, that in any event, the Company shall not reduce Executive’s annual target bonus below 90% of the Base Salary as in effect on the Effective Date;
|
(d)
|
a reduction by the Company of benefits under (1) a “pension plan or arrangement” or (2) a “compensation plan or arrangement”, in each case which Executive participates as of the Effective Date, or the elimination of Executive’s participation in any such plan or arrangement which reduction or elimination results in a reduction, in the aggregate, of the benefits provided thereunder, taking into account any replacement plan or arrangement or other additional compensation provided to Executive in connection with or following such reduction or elimination (except for immaterial reductions or across-the-board plan changes or terminations similarly affecting other Peer Executives);
provided
, that, subject to
Section 15.8
, in the event of any such changes or terminations, the Company shall timely pay or provide to Executive any accrued amounts or accrued benefits required to be paid or provided or which Executive is eligible to receive under any such plan or arrangement in accordance with the terms of such plan or arrangement;
|
(e)
|
the Company requiring Executive, without her consent, to be based at any office or location more than 50 miles from the Company’s current headquarters in Lebanon, Tennessee;
|
(f)
|
the material breach by the Company of any provision of this Agreement; or
|
(g)
|
the failure of 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.
|
(a)
|
The Company shall pay to Executive the sum of (i) Executive’s Base Salary then in effect through the date of termination to the extent not theretofore paid, (ii) a pro-rata portion of amounts payable under any then existing incentive or bonus plan applicable to Executive (including, without limitation, any incentive bonus referred to in
Section 4.2(a)
) for that portion of the fiscal year in which the termination of employment occurs through the date of termination, (iii) any accrued expenses and vacation pay to the extent not theretofore paid, (iv) any compensation previously deferred by Executive (together with any accrued interest or earnings thereon) to the extent not theretofore paid
,
and (v) any amounts payable under any then existing incentive or bonus plan applicable to Executive in respect of the fiscal year immediately preceding the fiscal year in which the termination of employment occurs
(the sum of the amounts described in subsections (i), (ii), (iii), (iv) and (v) shall be referred to in this Agreement as the “
Accrued Obligations
”);
provided
, that (x) the amounts described in subsections 9.1(a)(i) and (iii) will be paid in a lump sum on the Company’s first regularly scheduled payroll date for Peer Executives that occurs following Executive’s last day of employment, (y) the amount described in subsection 9.1(a)(ii) shall be paid as soon as practicable after the end of the fiscal year to which such bonus relates and the amount that is pro-rated for Executive’s length of service during the year shall be determined by the actual performance of the Company during such year, and (z) the amounts described in subsection 9.1(a)(iv) and (v) shall be paid at the times provided in the applicable plans under which the deferral was made or the bonus is payable;
|
(b)
|
The Company shall pay to Executive, commencing, unless delay is required pursuant to clause (b) of
Section 15.8
, on the first regularly scheduled Company payroll date for Peer Executives that occurs after the 30th day from Executive’s last day of employment with the Company, which payment will include amounts owed to Executive for the period between Executive’s last day of employment with the Company and the payment date, and the remaining installments shall be paid to Executive in accordance with the Company’s regularly scheduled payroll cycles and procedures for Peer Executives over the remainder of the 24-month period (such 30-day period, the “
Severance Delay Period
”),
provided
, that Executive has executed and delivered the Release and any revocation period applicable to such Release shall have expired as of the end of the Severance Delay Period, the aggregate of the following amounts:
|
(1)
|
in installments ratably over 24 months, as measured from Executive’s last day of employment with the Company, in accordance with the Company’s normal payroll cycle and procedures, the amount equal to 1.5 times the sum of Executive’s annual Base Salary and target bonus (referred to in
Section 4.2(a)
), each as in effect as of the date of termination (without giving effect to any reduction by the Company in annual Base Salary or annual target bonus percentage which would constitute Good Reason pursuant to
Section 8.2(b
)
or 8.2(c)(1))
;
|
(2)
|
Executive’s participation in the life, medical and disability
insurance programs in effect on the date of termination of employment shall continue for 24 months after the date of termination of employment;
provided
,
however
, that notwithstanding the foregoing, the Company shall not be obligated to provide such benefits if Executive becomes employed by another employer and is covered or permitted to be covered by that employer’s benefit plans, without regard to the extent of such coverage;
|
(c)
|
Unless the applicable award agreements contain more favorable vesting or exercise provisions upon Executive’s termination of employment, outstanding awards under the Company’s equity incentive plans shall vest and become exercisable as follows:
|
(1)
|
(i) all stock options held by Executive that are vested prior to or on the date of Executive’s termination of employment shall be exercisable in accordance with their terms and (ii) 50% of the shares subject to unvested stock options in each grant held by Executive as of the date of Executive’s termination of employment shall vest immediately and will be exercisable during such period as set forth in the applicable award agreement or incentive plan;
|
(2)
|
in the event that, as of the date of Executive’s termination of employment, Executive holds any shares of restricted stock (or restricted stock units or similar awards) whose vesting is subject solely to Executive’s continued employment with the Company, a percentage of such award shall immediately vest that is equal to a fraction, the numerator of which is the number of days that have elapsed between the date of grant and the date of Executive’s termination of employment, and the denominator of which is the total number of days in the original vesting term; and
|
(3)
|
in the event that, as of the date of Executive’s termination of employment, Executive holds, or has been allocated by action of the Compensation Committee and/or Board of Directors pursuant to performance based plans, any shares of restricted stock (or restricted stock units or similar awards, including, without limitation, performance shares and performance units) whose vesting is subject to performance criteria and the performance period for such award has not been completed, 100% of Completed Period Shares (as defined below) and 50% of Remaining Period Shares (as defined below) shall vest as of the date on which the Board (or applicable committee thereof) determines the actual performance of the Company during the applicable performance period and the actual number of shares (the “
Actual Number of Shares
”) of restricted stock (or restricted stock units or similar awards, including, without limitation, performance shares and performance units) that would have otherwise vested in the event Executive had remained employed by the Company through the determination date. For purposes of this Agreement, the term “
Completed Period Shares
” shall mean the Actual Number of Shares multiplied by the fraction, the numerator of which is the number of days that have elapsed between the first day of the applicable performance period and the date of the termination of Executive’s employment, and the denominator of which is the total number of days in the applicable performance period. The term “
Remaining Period Shares
” shall mean the Actual Number of Shares multiplied by the fraction, the numerator of which is the number of days that are remaining in the applicable performance period following the date of the termination of Executive’s employment, and the denominator of which is the total number of days in the applicable performance period.
|
(d)
|
To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other accrued amounts or accrued benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy, practice, contract or agreement of the Company (such other amounts and benefits shall be referred to in this Agreement as the “
Other Benefits
”), which Other Benefits are not subject to the execution of the Release and shall be paid to Executive at the times provided under the applicable plan, program, policy, practice, contract or agreement of the Company.
|
(a)
|
Unless delay is required pursuant to clause (b) of
Section 15.8
, the Company shall pay to Executive in a single lump sum cash payment on the first regularly scheduled Company payroll date for Peer Executives that occurs after the 30th day from Executive’s last day of employment with the Company,
provided
, that Executive has executed and delivered the Release and any revocation period applicable to such Release shall have expired as of the end of the Severance Delay Period, the aggregate of the following amounts:
|
(1)
|
the Accrued Obligations (as defined in
Section 9.1(a)(1)
, except that solely for purposes of this
Section 10.2(a)(1)
, (x) Executive’s target bonus shall be prorated based solely on the portion of the fiscal year in which the termination of employment occurs through the date of termination (and not on the Company’s actual performance for such period) and such prorated amount shall be paid contemporaneously with the amounts payable pursuant to
Section 10.2(a)(2)
and (y) the Accrued Obligations described in clauses (a)(i), (a)(iii) and (a)(iv) of
Section 9.1
shall not be conditioned on the execution of the Release and shall be paid to Executive at the time periods described in clause (a) of
Section 9.1
; and
|
(2)
|
the amount equal to 3 times the sum of (x) Executive’s Base Salary and (y) Executive’s target bonus (described in
Section 4.2(a)
), each as in effect as of the date of Executive’s termination of employment without regard to any action taken by the Company constituting Good Reason.
|
(b)
|
(i) All stock options held by Executive that are vested (including, without limitation, those vested by reason of subparagraph 10.2(b)(ii) and any Change in Control occurring prior to Executive’s termination of employment) on the effective date of the termination shall be exercisable in accordance with their terms and (ii) all unvested stock options held by Executive on the date of Executive’s termination of employment shall become immediately vested and exercisable.
|
(c)
|
In the event that, as of the date of Executive’s termination of employment, Executive holds any shares of restricted stock (or restricted stock units or similar awards) whose vesting is subject solely to Executive’s continued employment with the Company, such award shall vest immediately.
|
(d)
|
In the event that, as of the date of Executive’s termination of employment, Executive holds, or has been allocated by action of the Compensation Committee and/or Board of Directors pursuant to performance based plans, any shares of restricted stock (or restricted stock units or similar awards, including, without limitation, performance shares and performance units) whose vesting is subject to performance criteria and the performance period for such awards has not been completed, the target number or value, as applicable, of such awards shall vest immediately.
|
(e)
|
Executive’s participation in the life, medical and disability insurance programs in effect on the date of termination of employment shall continue for 24
months after the date of termination of employment;
provided
,
however
, that notwithstanding the foregoing, the Company shall not be obligated to provide such benefits if Executive becomes employed by another employer and is covered or permitted to be covered by that employer’s benefit plans, without regard to the extent of such coverage; and
|
(f)
|
To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any Other Benefits (as defined in
Section 9.1(d)
), which Other Benefits are not subject to the execution of the Release and shall be paid to Executive at the times provided under the applicable plan, program, policy, practice, contract or agreement of the Company.
|
(a)
|
any “person” (as defined in Section 13(h)(8)(E) of the Exchange Act), other than the Company or any of its subsidiaries or any employee benefit plan of the Company or any of its subsidiaries, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company (or any successor to all or substantially all of the Company’s assets) representing more than 30% of the combined voting power of the Company’s (or such successor’s) then outstanding voting securities that may be cast for the election of directors of the Company (other than as a result of an issuance of securities initiated by the Company (or such successor) in the ordinary course of business);
|
(b)
|
as the result of, or in connection with, any cash tender or exchange offer, merger or other business combination or contested election, or any combination of the foregoing transactions, less than a majority of the combined voting power of the then outstanding securities of the Company or any successor company or entity entitled to vote generally in the election of the directors of the Company or such other corporation or entity after such transaction are held in the aggregate by the holders of the Company’s securities entitled to vote generally in the election of directors of the Company immediately prior to such transaction;
|
(c)
|
all or substantially all of the assets of the Company are sold, exchanged or otherwise transferred;
|
(d)
|
the Company’s shareholders approve a plan of liquidation or dissolution of the Company; or
|
(e)
|
during the Term, Continuing Directors cease for any reason to constitute at least a majority of the Board. For this purpose, a “
Continuing Director
” is any person who at the beginning of the Term was a member of the Board, or any person first elected to the Board during the Term whose election, or the nomination for election by the Company’s shareholders, was approved by a vote of at least two-thirds of the Continuing Directors then in office, but excluding any person (1) initially appointed or elected to office as result of either an actual or threatened election and/or proxy contest by or on behalf of any “person” or “group” (within the meaning of Section 13(d) of the Exchange Act) other than the Board, or (2) designated by any “person” or “group” (within the meaning of Section 13(d) of the Exchange Act) ) who has entered into an agreement with the Company to effect a transaction described in
Section 10.3(a)
through
(d)
.
|
(a)
|
Notwithstanding any other provision to the contrary, if any payments or benefits Executive would receive from the Company pursuant to this Agreement or otherwise (collectively, the “
Payments
”) would, either separately or in the aggregate, (i) constitute “parachute payments” within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “
Excise Tax
”), then the Payments will be equal to the Reduced Amount (defined below). The “
Reduced Amount
” will be either (1) the entire amount of the Payments, or (2) an amount equal to the largest portion of the Payments that would result in no portion of any of the Payments (after reduction) being subject to the Excise Tax, whichever amount after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes), results in the Executive’s receipt, on an after-tax basis, of the greatest amount of the Payments. If a reduction in the Payments is to be made so that the amount of the Payments equals the Reduced Amount, the Payments will be paid only to the extent permitted under the Reduced Amount alternative;
provided
, that in the event the Reduced Amount is paid, the cash payments set forth in
Section 10.2(a)
shall be reduced as required by the operation of this
Section 10.4
.
|
(b)
|
The Company shall engage the accounting firm engaged by the Company for general audit purposes at least 20 business days prior to the effective date of the Change in Control to perform any calculation necessary to determine the amount, if any, payable to Executive pursuant to
Article 10
, as limited by this
Section 10.4
. If the accounting firm so engaged by the Company is also serving as accountant or auditor for the individual, entity or group that will control the Company following the Change in Control, the Company may appoint a nationally recognized accounting firm other than the accounting firm engaged by the Company for general audit purposes to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder.
|
(c)
|
The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and Executive within 20
days after the date on which such accounting firm has been engaged to make such determinations or within such other time period as agreed to by the Company and Executive. Any good faith determinations of the accounting firm made hereunder shall be final, binding and conclusive upon the Company and Executive.
|
(d)
|
Notwithstanding the foregoing, in determining the reduction, if any, that shall occur as a result of this
Section 10.4
, the amounts payable or benefits to be provided to Executive shall be reduced such that the economic loss to Executive as a result of the Excise Tax elimination is minimized. In applying this principle, the reduction shall be made in a manner consistent with the requirements of Section 409A of the Code and where two economically equivalent amounts are subject to reduction but payable at different times, such amounts shall be reduced on a pro rata basis but not below zero.
|
(a)
|
“
Competitive Position
” shall mean any employment, consulting, advisory, directorship, agency, promotional or independent contractor arrangement between Executive and any person or Entity engaged, wholly or in material part, or that is an investor or prospective investor in an Entity that is engaged, wholly or in material part, in the restaurant business that is the same or similar to that in which the Company or any of its subsidiaries or affiliates (without regard to the retail component of the business) (collectively, the “
CBRL Entities
”) is engaged on the date of the termination of Executive’s employment.
|
(b)
|
“
Confidential Information
” shall mean the proprietary or confidential data, information, documents or materials (whether oral, written, electronic or otherwise) belonging to or pertaining to any of the CBRL Entities, other than “Trade Secrets” (as defined below), which is of tangible or intangible value to any of the CBRL Entities and the details of which are not generally known to the competitors of the CBRL Entities. Confidential Information shall also include: any items that any of the CBRL Entities have marked “CONFIDENTIAL” or some similar designation or are otherwise identified as being confidential.
|
(c)
|
“
Entity
” or “
Entities
” shall mean any business, individual, partnership, joint venture, agency, governmental agency, body or subdivision, association, firm, corporation, limited liability company or other entity of any kind.
|
(d)
|
“
Restricted Period
” shall mean, with respect to
Section 13.3
, four years following the termination of Executive’s employment (which shall include, without limitation, the circumstances set forth in
Section 2.2(b)
). "
Restricted Period
", with respect to Sections 13.4 and 13.5, shall mean the following: 1) two years following the termination of Executive’s employment, in the event that this Agreement is terminated for any reason (including, without limitation, the circumstances set forth in Sections 5, 8, 9 and 10) by either party prior to the Expiration Date; or 2) eighteen months following the Expiration Date, in the event that this Agreement has not been terminated for any reason by either party prior to the Expiration Date. Notwithstanding the foregoing, the Restricted Period shall be extended for a period of time equal to any period(s) of time that Executive is determined by a final non-appealable judgment from a court of competent jurisdiction to have engaged in any conduct that violates any provision of this
Article 13
(the purpose of this provision is to secure for the benefit of the Company the entire Restricted Period being bargained for by the Company for the restrictions upon the Executive’s activities).
|
(e)
|
“
Territory
” shall mean each of the United States of America and any foreign country in which the Company operates its business at the time of the termination of Executive’s employment.
|
(f)
|
“
Trade Secrets
” shall mean information or data of or about any of the CBRL Entities, including, but not limited to, technical or non-technical data, recipes, formulas, patterns, compilations, programs, devices, methods, techniques, drawings, processes, financial data, financial plans, product plans or lists of actual or potential suppliers that: (1) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; (2) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy; and (3) any other information which is defined as a “trade secret” under applicable law.
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(g)
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“
Work Product
” shall mean all tangible work product, property, data, documentation, “know-how,” concepts or plans, inventions, improvements, techniques and processes relating to any of the CBRL Entities that were conceived, discovered, created, written, revised or developed by Executive during the term of her employment with the Company.
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(a)
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In recognition of the need of the CBRL Entities to protect their legitimate business interests, Confidential Information and Trade Secrets, Executive hereby covenants and agrees that Executive shall regard and treat Trade Secrets and all Confidential Information as strictly confidential and wholly-owned by the CBRL Entities and shall not, for any reason, in any fashion, either directly or indirectly, use, sell, lend, lease, distribute, license, give, transfer, assign, show, disclose, disseminate, reproduce, copy, misappropriate or otherwise communicate any such item or information to any third party or Entity for any purpose other than in accordance with this Agreement or as required by applicable law, court order or other legal process: (1) with regard to each item constituting a Trade Secret, at all times such information remains a “trade secret” under applicable law, and (2) with regard to any Confidential Information, for the Restricted Period.
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(b)
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Executive shall exercise best efforts to ensure the continued confidentiality of all Trade Secrets and Confidential Information, and she shall immediately notify the Company of any unauthorized disclosure or use of any Trade Secrets or Confidential Information of which Executive becomes aware. Executive shall assist the CBRL Entities, to the extent necessary, in the protection of or procurement of any intellectual property protection or other rights in any of the Trade Secrets or Confidential Information.
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(c)
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All Work Product shall be owned exclusively by the CBRL Entities. To the greatest extent possible, any Work Product shall be deemed to be “work made for hire” (as defined in the Copyright Act, 17 U.S.C.A. § 101 et seq., as amended), and Executive hereby unconditionally and irrevocably transfers and assigns to the applicable CBRL Entity all right, title and interest Executive currently has or may have by operation of law or otherwise in or to any Work Product, including, without limitation, all patents, copyrights, trademarks (and the goodwill associated therewith), trade secrets, service marks (and the goodwill associated therewith) and other intellectual property rights. Executive agrees to execute and deliver to the applicable CBRL Entity any transfers, assignments, documents or other instruments which the Company may deem necessary or appropriate, from time to time, to protect the rights granted herein or to vest complete title and ownership of any and all Work Product, and all associated intellectual property and other rights therein, exclusively in the applicable CBRL Entity.
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(a)
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Notwithstanding the other provisions hereof, this Agreement is intended to comply with the requirements of Section 409A of the Code, to the extent applicable, and this Agreement shall be interpreted to avoid any penalty sanctions under Section 409A of the Code. Accordingly, all provisions herein, or incorporated by reference, shall be construed and interpreted to comply with Section 409A and, if necessary, any such provision shall be deemed amended to comply with Section 409A and regulations thereunder. If any payment or benefit cannot be provided or made at the time specified herein without incurring sanctions under Section 409A of the Code, then such benefit or payment shall be provided in full at the earliest time thereafter when such sanctions will not be imposed. Except to the extent permitted under Section 409A, in no event may Executive, directly or indirectly, designate the calendar year of any payment under this Agreement. Each payment made under this Agreement shall be treated as a separate payment and the right to a series of installment payments under this Agreement is to be treated as a right to a series of separate payments.
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(b)
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Notwithstanding any provision to the contrary in this Agreement, if on the date of the Executive’s termination of employment, the Executive is a “specified employee” (as such term is defined in section 409A(a)(2)(B)(i) of the Code and its corresponding regulations) as determined by the Board (or its delegate) in accordance with its “specified employee” determination policy, then all severance benefits payable to the Executive under this Agreement that constitute deferred compensation subject to the requirements of Section 409A of the Code that are payable to Executive within the six (6) month period following Executive’s separation from service shall be postponed for a period of six (6) months following Executive’s “separation from service” with the Company (or any successor thereto). Any payments delayed pursuant to this
Section 15.8(b
) will be made in a lump sum on the Company’s first regularly scheduled payroll date for Peer Executives that follows such six (6) month period or, if earlier, the date of the Executive’s death, and any remaining payments required to be made under this Agreement will be paid upon the schedule otherwise applicable to such payments under this Agreement.
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(c)
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Notwithstanding any other provision to the contrary, a termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of “deferred compensation” (as such term is defined in Section 409A of the Code and the Treasury Regulations promulgated thereunder) upon or following a termination of employment unless such termination is also a “separation from service” from the Company within the meaning of Section 409A of the Code and Section 1.409A-1(h) of the Treasury Regulations and, for purposes of any such provision of this Agreement, references to a “separation,” “termination,” “termination of employment” or like terms shall mean “separation from service.”
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(d)
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Notwithstanding any other provision to the contrary, in no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Section 409A of the Code and the Treasury Regulations promulgated thereunder be subject to offset by any other amount unless otherwise permitted by Section 409A of the Code.
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(e)
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To the extent that any reimbursement, fringe benefit or other similar plan or arrangement in which Executive participates during the term of Executive’s employment under this Agreement or thereafter provides for a “deferral of compensation” within the meaning of Section 409A of the Code, (1) the amount eligible for reimbursement or payment under such plan or arrangement in one calendar year may not affect the amount eligible for reimbursement or payment in any other calendar year (except that a plan providing medical or health benefits may impose a generally applicable limit on the amount that may be reimbursed or paid); (2) subject to any shorter time periods provided herein or the applicable plans or arrangements, any reimbursement or payment of an expense under such plan or arrangement must be made on or before the last day of the calendar year following the calendar year in which the expense was incurred; and (3) any such reimbursement or payment may not be subject to liquidation or exchange for another benefit, all in accordance with Section 1.409A-3(i)(1)(iv) of the Treasury Regulations.
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(f)
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By accepting this Agreement, Executive hereby agrees and acknowledges that the Company does not make any representations with respect to the application of Section 409A of the Code to any tax, economic or legal consequences of any payments payable to Executive hereunder. Additionally, by the acceptance of this Agreement, Executive acknowledges that Executive has obtained independent tax advice regarding the application of Section 409A of the Code to the payments due to Executive hereunder.
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If to Company to:
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Cracker Barrel Old Country Store, Inc.
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Attn: General Counsel
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P.O. Box 787
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305 Hartmann Drive
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Lebanon, TN 37088-0787
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Facsimile: (615) 443-9818
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If to Executive to:
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Executive’s most recent address on file with the Company
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(a)
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The parties shall first use their best efforts to discuss and negotiate a resolution of the dispute.
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(b)
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If efforts to negotiate a resolution do not succeed within five business days after a written request for negotiation has been made, a party may submit the dispute to mediation by sending a letter to the other party requesting mediation. The dispute shall be mediated by a mediator agreeable to the parties or, if the parties cannot agree to a mediator, by a mediator selected by the American Arbitration Association. If the parties cannot agree to a mediator within five business days, either party may submit the dispute to the American Arbitration Association for the appointment of a mediator. Mediation shall commence within ten business days after the mediator has been named.
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(c)
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The provisions of this
Section 15.16
shall not apply to any dispute relating to the ability of the Company to terminate Executive’s employment pursuant to
Article 5
(Termination for Cause) or
Article 9
(Termination Without Cause) of this Agreement nor shall they apply to any action by the Company seeking to enforce its rights arising out of or related to the provisions of
Article 13
of this Agreement.
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CRACKER BARREL OLD COUNTRY STORE, INC.
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By:
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/s/Michael J. Zylstra
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Name: Michael J. Zylstra
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Title: Vice President, General Counsel and Corporate Secretary
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“EXECUTIVE”
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/s/ Sandra B. Cochran
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Sandra B. Cochran
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By:
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Name:
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Title:
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Date:
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Sandra B. Cochran
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Date:
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(a) | personal dishonesty or willful misconduct in connectionwith any material aspect of your duties to the Company; |
(b) | breach of fiduciary duty; |
(c) | your conviction for, or your pleading guilty or no contestto, any felony or crime involving moral turpitude; or |
(d) | your willful or intentional misconduct that causes (or isreasonably believed by the Company to have caused)material and demonstrable injury, monetarily or otherwise,to the Company; |
CRACKER BARREL OLD COUNTRY STORE, INC.
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By:
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Michael J. Zylstra
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Title:
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Vice President, General Counsel and Corporate Secretary
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Company Employee’s Signature:
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/s/ Sandra B. Cochran
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Please Print or Type Name:
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Sandra B. Cochran
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Please Print or Type Title:
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President and Chief Executive Officer
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Position
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Severance Benefit
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Chief Executive Officer
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18 months base salary
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1. | I understand that any payments or benefits paid (or the right to obtain such payments or benefits granted to me subject to compliance with Section 5) under Section 2 or 3 of the Agreement represent, in part, consideration for signing this General Release and are not salary, wages or benefits to which I was already entitled. I understand and agree that I will not receive the payments and benefits specified in Section 2 or Section 3 of the Agreement unless I execute this General Release and do not revoke this General Release within the time period permitted hereafter or breach this General Release. Such payments and benefits will not be considered compensation for purposes of any employee benefit plan, program, policy or arrangement maintained or hereafter established by the Company or its affiliates. I also acknowledge and represent that I have received all payments and benefits that I am entitled to receive (as of the date hereof) by virtue of any employment by the Company. |
2. | Except as provided in paragraph 4 below, I knowingly and voluntarily (for myself, my heirs, executors, administrators and assigns) release and forever discharge the Company and the other Released Parties from any and all claims, suits, controversies, actions, causes of action, cross‑claims, counter‑claims, demands, debts, compensatory damages, liquidated damages, punitive or exemplary damages, other damages, claims for costs and attorneys’ fees, or liabilities of any nature whatsoever in law and in equity, both past and present (through the date this General Release becomes effective and enforceable) and whether known or unknown, suspected, or claimed against the Company or any of the Released Parties which I, my spouse, or any of my heirs, executors, administrators or assigns, may have, which arise out of or are connected with my employment with, or my separation or termination from, the Company (including, but not limited to, any allegation, claim or violation, arising under: Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967, as amended (including the Older Workers Benefit Protection Act); the Equal Pay Act of 1963, as amended; the Americans with Disabilities Act of 1990; the Family and Medical Leave Act of 1993; the Worker Adjustment Retraining and Notification Act; the Employee Retirement Income Security Act of 1974; the Genetic Information Nondiscrimination Act of 2008; any applicable Executive Order Programs; the Fair Labor Standards Act; or their state or local counterparts; or under any other federal, state or local civil or human rights law, or under any other local, state, or federal law, regulation or ordinance; or under any public policy, contract or tort, or under common law; or arising under any policies, practices or procedures of the Company; or any claim for wrongful discharge, breach of contract, infliction of emotional distress, defamation; or any claim for costs, fees, or other expenses, including attorneys’ fees incurred in these matters) (all of the foregoing collectively referred to herein as the “ Claims ”). |
3. | I represent that I have made no assignment or transfer of any right, claim, demand, cause of action, or other matter covered by paragraph 2 above. |
4. | In signing this General Release, I acknowledge and intend that it shall be effective as a bar to each and every one of the Claims hereinabove mentioned or implied. I expressly consent that this General Release shall be given full force and effect according to each and all of its express terms and provisions, including those relating to unknown and unsuspected Claims (notwithstanding any state statute that expressly limits the effectiveness of a general release of unknown, unsuspected and unanticipated Claims), if any, as well as those relating to any other Claims hereinabove mentioned or implied. I acknowledge and agree that this waiver is an essential and material term of this General Release and that without such waiver the Company would not have agreed to the terms of the Agreement. I further agree that in the event I should bring a Claim seeking damages against the Company, or in the event I should seek to recover against the Company in any Claim brought by a governmental agency on my behalf, this General Release shall serve as a complete defense to such Claims. I further agree that I am not aware of any pending charge or complaint of the type described in paragraph 2 as of the execution of this General Release. |
5. | I agree that neither this General Release, nor the furnishing of the consideration for this General Release, shall be deemed or construed at any time to be an admission by the Company, any Released Party or myself of any improper or unlawful conduct. |
6. | I agree that if I violate this General Release by suing the Company or the other Released Parties for any claim that does not arise under the Age Discrimination in Employment Act, I will pay all costs and expenses of defending against the suit incurred by the Released Parties, including reasonable attorneys’ fees, and return all payments received by me pursuant to the Agreement. |
7. | I agree that this General Release is confidential and agree not to disclose any information regarding the terms of this General Release, except to my immediate family and any tax, legal or other counsel I have consulted regarding the meaning or effect hereof or as required by law, and I will instruct each of the foregoing not to disclose the same to anyone. Notwithstanding anything herein to the contrary, each of the parties (and each affiliate and person acting on behalf of any such party) agree that each party (and each employee, representative, and other agent of such party) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of this transaction contemplated in the Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to such party or such person relating to such tax treatment and tax structure, except to the extent necessary to comply with any applicable federal or state securities laws. This authorization is not intended to permit disclosure of any other information including (without limitation) (i) any portion of any materials to the extent not related to the tax treatment or tax structure of this transaction, (ii) the identities of participants or potential participants in the Agreement, (iii) any financial information (except to the extent such information is related to the tax treatment or tax structure of this transaction), or (iv) any other term or detail not relevant to the tax treatment or the tax structure of this transaction. |
8. | Any non‑disclosure provision in this General Release does not prohibit or restrict me (or my attorney) from responding to any inquiry about this General Release or its underlying facts and circumstances by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), any other self‑regulatory organization or governmental entity. |
9. | I agree to reasonably cooperate with the Company in any internal investigation, any administrative, regulatory, or judicial proceeding or any dispute with a third party. |
10. | I agree not to disparage the Company, its past and present investors, officers, directors or employees or its affiliates and to keep all confidential and proprietary information about the past or present business affairs of the Company and its affiliates confidential in accordance with the terms of the Agreement unless a prior written release from the Company is obtained. I further agree that as of the date hereof, I have returned to the Company any and all property, tangible or intangible, relating to its business, which I possessed or had control over at any time (including, but not limited to, Company‑provided credit cards, building or office access cards, keys, computer equipment, manuals, files, documents, records, software, customer data base and other data) and that I shall not retain any copies, compilations, extracts, excerpts, summaries or other notes of any such manuals, files, documents, records, software, customer data base or other data. Nothing in this Agreement will prohibit the making of any truthful statements made by any Person in response to a lawful subpoena or legal proceeding or to enforce such Person’s rights under this Agreement, or any other agreement between you, the Company, and its Subsidiaries. |
11. | Notwithstanding anything in this General Release to the contrary, this General Release shall not relinquish, diminish, or in any way affect (i) any rights or claims arising out of any breach by the Company or by any Released Party of the Agreement after the date hereof, (ii) any rights or obligations under applicable law which cannot be waived or released pursuant to an agreement, (iii) any rights to payments or benefits under Section 2 or Section 3 of the Agreement, (iv) my rights of indemnification and directors and officers insurance coverage to which I may be entitled solely with regards to my service as an officer or director of the Company; (v) my rights with regard to accrued benefits under any employee benefit plan, policy or arrangement maintained by the Company or under COBRA; and (vi) my rights as a stockholder or other equityholder of the Company and/or its affiliates. |
12. | Whenever possible, each provision of this General Release shall be interpreted in, such manner as to be effective and valid under applicable law, but if any provision of this General Release is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this General Release shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein. |
(a) | I HAVE READ IT CAREFULLY; |
(b) | I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED; |
(c) | I VOLUNTARILY CONSENT TO EVERYTHING IN IT; |
(d) | I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND I HAVE DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION, I HAVE CHOSEN NOT TO DO SO OF MY OWN VOLITION; |
(e) | I HAVE HAD AT LEAST 21 DAYS FROM THE DATE OF MY RECEIPT OF THIS RELEASE SUBSTANTIALLY IN ITS FINAL FORM ON TO CONSIDER IT; |
(f) | THE CHANGES TO THE AGREEMENT SINCE EITHER ARE NOT MATERIAL OR WERE MADE AT MY REQUEST. |
(g) | I UNDERSTAND THAT I HAVE SEVEN DAYS AFTER THE EXECUTION OF THIS RELEASE TO REVOKE IT AND THAT THIS RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION PERIOD HAS EXPIRED; |
(h) | I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND |
(i) | I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE AMENDED, WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME. |
DATE:
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Name:
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(Print)
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ACCEPTED:
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CRACKER BARREL OLD COUNTRY STORE, INC.
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By:
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Title:
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Date:
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DATE:
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Name:
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(Print)
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State of
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Parent
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Incorporation
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Cracker Barrel Old Country Store, Inc.
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Tennessee
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Subsidiaries
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CBOCS Distribution, Inc.
(dba Cracker Barrel Old Country Store)
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Tennessee
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CBOCS Properties, Inc.
(dba Cracker Barrel Old Country Store)
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Michigan
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CBOCS West, Inc.
(dba Cracker Barrel Old Country Store)
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Nevada
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Rocking Chair, Inc.
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Nevada
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CBOCS Texas, LLC
(dba Cracker Barrel Old Country Store)
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Tennessee
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1. | I have reviewed this Annual Report on Form 10-K of Cracker Barrel Old Country Store, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
1. | I have reviewed this Annual Report on Form 10-K of Cracker Barrel Old Country Store, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Issuer. |
Date:
September 26, 2013
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By: |
/s/Sandra B. Cochran
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Sandra B. Cochran
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President and Chief Executive Officer
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1.
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Report fairly presen
ts, in all material respects, the financial condition and results of operations of the Issuer.
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Date:
September 26, 2013
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By: |
/s/Lawrence E. Hyatt
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Lawrence E. Hyatt,
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Senior Vice President and Chief Financial Officer
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