EXHIBIT 10.16
SEVERANCE AGREEMENT
THIS SEVERANCE AGREEMENT ("Agreement") is made as of December 13th, 2004, by and
between Caribou Coffee Company, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇ ("Employer" or the "Company") and ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Employee").
WHEREAS, Employer has offered an employment position to Employee as Vice
President of Real Estate and Store Development, pursuant to the offer letter,
dated November 29, 2004 (the "Offer Letter"); and
WHEREAS, Employee has accepted Employer's offer of employment pursuant to the
Offer Letter, subject to Employer's agreement to provide a severance arrangement
as set forth in this Agreement; and
WHEREAS, Employee will commence her employment on December 13, 2004.
NOW, THEREFORE, in consideration of the mutual covenants and obligations
hereinafter set forth, the parties agree as follows:
1. Term. This Agreement shall run for a period of two (2) years commencing on
December 13, 2004.
2. Triggering Termination. In consideration of Employee's agreement to accept
employment pursuant to the terms of the Offer Letter, Employer agrees that in
the event of a Triggering Termination (as defined below) of Employee during the
Term of this Agreement, then in addition to all other compensation due and
payable to Employee as of the date of such termination, Employer agrees to pay
the Severance Payment to Employee, subject to the conditions contained in
Paragraph 6 herein. For purposes of this Agreement a Triggering Termination
shall be a termination that is not For Cause or is Involuntary (as defined
below). The parties understand and agree that no Severance Payment shall be due
or payable hereunder unless Employee's termination is a Triggering Termination
and Employee complies with Paragraph 6 herein.
3. For Cause. For purposes of this Agreement, "For Cause" means:
(i) the Employee has engaged in gross negligence or gross misconduct, including
willful and material failure to perform the Employee's duties as an officer or
employee of the Company and, in the event that the gross negligence or gross
misconduct is capable of being cured, Employee's failure to cure such default
within thirty (30) days after receipt of written notice of default from the
Company;
(ii) the Employee has committed fraud, misappropriation, breach of fiduciary
duty, or embezzlement in connection with the Company's business;
(iii) the Employee has committed any criminal felony;
(iv) Employee's abandonment of her employment with the Company;
(v) If, during the first year of this Agreement, Employee becomes unable (as
determined by the Company in good faith) to regularly perform her duties
hereunder by reason of illness or incapacity for a period of more than three (3)
consecutive months; or
(vi) If, during the second year of this Agreement, Employee becomes unable (as
determined by the Company in good faith) to regularly perform her duties
hereunder by reason of illness or incapacity for a period of more than six (6)
consecutive months.
4. Constructive Termination. The parties agree that a termination shall be
deemed "Involuntary" in the event that:
(i) the Company has breached any provision of this Agreement and, in the event
that the breach is capable of being cured, Employer's failure to cure such
breach within thirty (30) days after receipt of written notice of default from
Employee;
(ii) the Company significantly and adversely changes the terms of Employee's
employment from those set forth in the Offer Letter and, in the event that the
changes are capable of being cured or remedied, Employer's failure to cure or
remedy such changes within fifteen (15) days after receipt of written notice of
default from Employee; or
(iii) the Company requires Employee to relocate her employment outside of the
seven-county metro area of Minneapolis/St. ▇▇▇▇.
5. ▇▇▇▇▇▇▇▇▇ Payment. The Severance Payment shall be an amount equal to six
months of the Employee's salary, calculated at the rate of $190,000 per year or
Employee's base salary at the time of termination, whichever is greater. The
Severance Payment shall be paid, at Employer's option, in a lump sum at the time
of termination or in bi-weekly installments in accordance with Employer's normal
compensation schedule. The Severance Payment shall be subject to all applicable
employee withholding taxes, and Employee will be responsible for all applicable
taxes associated with the Severance Payment.
6. Release. In the event of a Triggering Termination, Employer shall only be
required to make the Severance Payment if and only after Employee signs the
Release attached hereto as Exhibit A on or within 21 days following her last
date of employment and does not rescind the Release within 15 days after signing
it.
7. Notices. All notices, demands and communications required, desired or
permitted to be given hereunder shall be in writing and shall be deemed to have
been duly given on the date received, if delivered personally, or on the third
day after mailing, if sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to
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the parties at the addresses set forth below or to such other person at such
location as either party hereto may subsequently designate in a similar manner.
8. Construction of Agreement. This Agreement shall be interpreted, construed and
governed by and under the laws of the State of Minnesota, and the parties
unconditionally submit to the jurisdiction of the courts located in the State of
Minnesota in all matters relating to or arising from this Agreement.
9. Entire Agreement. This Agreement contains the entire agreement between the
parties hereto with respect to the subject matter hereof, and there are no
understandings, representations or warranties of any kind between the parties
except as expressly set forth herein. This Agreement may not be modified except
by a writing duly signed by both parties hereto.
10. Employee's Breach of Employee Non-Disclosure, Non-Compete and Non-
Solicitation Agreement. To the extent that Employee has breached an obligation
contained in Employee's Non-Disclosure, Non-Compete and Non-Solicitation
Agreement ("Employee Agreement"), including and without limitation Sections 2,
4, 5 or 6 of the Employee Agreement, all amounts paid to Employee under this
Agreement will be forfeited and returned to Employer as part of Employer's
remedy, and no additional payments shall be made to Employee under this
Agreement. This remedy is in addition to, and not in lieu of, any remedies
available under the Employee Agreement
11. Arbitration. Any controversy or claim arising out of or relating to this
Agreement or the breach of this Agreement, with the exception of any claim,
counterclaim or controversy arising out of or relating to Section 10 herein,
shall be settled by arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association, and a judgment upon the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction
thereof. A single arbitrator shall be selected by the parties or their
representatives, if they can agree, otherwise, as provided in Chapter 572
Minnesota Statutes (the "Act"), as the Act is amended at the time of submission
of the issue to arbitration. The arbitration award shall be subject to review
only in the manner provided in the Act. The arbitrator(s) shall award the
prevailing party its costs and reasonable attorney's fees which shall be paid by
the non-prevailing party. Any arbitration proceeding will take place in
Minneapolis or St. ▇▇▇▇, Minnesota and will be governed by the Minnesota Rules
of Civil Procedure. All discovery must be completed no later than twenty (20)
days before the hearing date and the arbitration proceeding must be completed
within ninety days (90) days of the commencement of the arbitration proceedings.
The arbitrator(s) will decide any pre-hearing motions.
The parties hereto have executed this Agreement as of the date first set forth
above.
"EMPLOYER"
CARIBOU COFFEE COMPANY, INC. "EMPLOYEE"
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/s/ /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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By: ▇▇▇▇▇ ▇▇▇▇▇
Its: VP of HR 12-14-04
EXHIBIT A
RELEASE BY ▇▇▇▇▇ ▇▇▇▇▇
DEFINITIONS. I intend all words used in this Release to have their plain
meanings in ordinary English. Specific terms that I use in this Release have the
following meanings:
A. I, me, and my include both me and anyone who has or obtains
any legal rights or claims through me.
B. CARIBOU means CARIBOU COFFEE COMPANY, INC., any company
related to CARIBOU COFFEE COMPANY, INC. in the present or past
(including without limitation, its predecessors, parents,
subsidiaries, affiliates, joint venture partners, and
divisions), and any successors of CARIBOU COFFEE COMPANY, INC.
C. Company means Caribou, the present and past officers,
directors, committees, shareholders, and employees of Caribou;
the present and past fiduciaries of any employee benefit plan
sponsored or maintained by Caribou (other than multi-employer
plans); the attorneys for Caribou; and anyone who acted on
behalf of Caribou or on instructions from Caribou.
▇. ▇▇▇▇▇▇▇▇▇ Agreement means the Severance Agreement between
Caribou and me dated December __, 2004, including all of the
documents attached to the Severance Agreement.
E. My Claims mean all of my rights that I now have to any relief
of any kind from the Company, including without limitation:
1. all claims arising out of or relating to my
employment with Caribou or the termination of that
employment;
2. all claims arising out of or relating to the
statements, actions, or omissions of the Company;
3. all claims for any alleged unlawful discrimination,
harassment, retaliation or reprisal, or other alleged
unlawful practices arising under any federal, state,
or local statute, ordinance, or regulation, including
without limitation, claims under Title VII of the
Civil Rights Act of 1964, the Age Discrimination in
Employment Act, the Americans with Disabilities Act,
42 U.S.C. Section 1981, the Employee Retirement
Income Security Act, the Equal Pay Act, the
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Worker Adjustment and Retraining Notification Act,
the Minnesota Human Rights Act, the Fair Credit
Reporting Act, and workers' compensation
non-interference or non-retaliation statutes (such as
Minn. Stat. Section 176.82);
4. all claims for alleged wrongful discharge; breach of
contract; breach of implied contract; failure to keep
any promise; breach of a covenant of good faith and
fair dealing; breach of fiduciary duty; estoppel; my
activities, if any, as a "whistleblower"; defamation;
infliction of emotional distress; fraud;
misrepresentation; negligence; harassment;
retaliation or reprisal; constructive discharge;
assault; battery; false imprisonment; invasion of
privacy; interference with contractual or business
relationships; any other wrongful employment
practices; and violation of any other principle of
common law;
5. all claims for compensation of any kind, including
without limitation, bonuses, commissions, stock-based
compensation or stock options, vacation pay, and
expense reimbursements;
6. all claims for back pay, front pay, reinstatement,
other equitable relief, compensatory damages, damages
for alleged personal injury, liquidated damages, and
punitive damages; and
7. all claims for attorneys' fees, costs, and interest.
However, My Claims do not include any claims that the law does
not allow to be waived, any claims that may arise after the
date on which I sign this Release, or any claims for
indemnification under the charter documents of the Company or
under any applicable state or federal statute.
AGREEMENT TO RELEASE MY CLAIMS. I will receive consideration from Caribou as set
forth in the Severance Agreement if I sign and do not rescind this Release as
provided below. I understand and acknowledge that that consideration is in
addition to anything of value that I would be entitled to receive from Caribou
if I did not sign this Release or if I rescinded this Release. In exchange for
that consideration I give up and release all of My Claims. I will not make any
demands or claims against the Company for compensation or damages relating to My
Claims. The consideration that I am receiving is a fair compromise for the
release of My Claims.
ADDITIONAL AGREEMENTS AND UNDERSTANDINGS. Even though Caribou will provide
consideration for me to settle and release My Claims, the Company does not admit
that it is responsible or legally obligated to me. In fact, the Company denies
that it is responsible or legally obligated to me for My Claims, denies that it
engaged in any unlawful or improper conduct toward me, and denies that it
treated me unfairly.
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ADVICE TO CONSULT WITH AN ATTORNEY. I understand and acknowledge that I am
hereby being advised by the Company to consult with an attorney prior to signing
this Release and I have done so. My decision whether to sign this Release is my
own voluntary decision made with full knowledge that the Company has advised me
to consult with an attorney.
PERIOD TO CONSIDER THE RELEASE. I understand that I have 21 days following my
last day of employment with the Company to consider whether I wish to sign this
Release. If I sign this Release before the end of the 21-day period, it will be
my voluntary decision to do so because I have decided that I do not need any
additional time to decide whether to sign this Release.
MY RIGHT TO RESCIND THIS RELEASE. I understand that I may rescind this Release
at any time within 15 days after I sign it, not counting the day upon which I
sign it. This Release will not become effective or enforceable unless and until
the 15-day rescission period has expired without my rescinding it.
PROCEDURE FOR ACCEPTING OR RESCINDING THE RELEASE. To accept the terms of this
Release, I must deliver the Release, after I have signed and dated it, to
Caribou by hand or by mail within the 21-day period that I have to consider this
Release. To rescind my acceptance, I must deliver a written, signed statement
that I rescind my acceptance to Caribou by hand or by mail within the 15-day
rescission period. All deliveries must be made to Caribou at the following
address:
▇▇▇▇▇ ▇▇▇▇▇▇▇
Vice President of Human Resources
Caribou Coffee Company, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If I choose to deliver my acceptance or the rescission of my acceptance by mail,
it must be (1) postmarked within the period stated above; and (2) properly
addressed to Caribou at the address stated above.
INTERPRETATION OF THE RELEASE. This Release should be interpreted as broadly as
possible to achieve my intention to resolve all of My Claims against the
Company. If this Release is held by a court to be inadequate to release a
particular claim encompassed within My Claims, this Release will remain in full
force and effect with respect to all the rest of My Claims.
MY REPRESENTATIONS. I am legally able and entitled to receive the consideration
being provided to me in settlement of My Claims. I have not been involved in any
personal bankruptcy or other insolvency proceedings at any time since I began my
employment with Caribou. No child support orders, garnishment orders, or other
orders requiring that money owed to me by Caribou be paid to any other person
are now in effect
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I have read this Release carefully. I understand all of its terms. In signing
this Release, I have not relied on any statements or explanations made by the
Company except as specifically set forth in the Severance Agreement. I am
voluntarily releasing My Claims against the Company. I intend this Release and
the Letter Agreement to be legally binding.
Dated:
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