Cracker Barrel Old Country Store, Inc.
Shareholder Annual Meeting in a DEF 14A on 10/07/2021   Download
SEC Document
SEC Filing
DEF 14A 1 tm2127874-2_def14a.htm DEF 14A tm2127874-2_def14a - none - 21.640753s
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No.      )
Filed by the Registrant   ☒
Filed by a party other than the Registrant   ☐
Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material Pursuant to §240.14a-12
Cracker Barrel Old Country Store, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than The Registrant)
Payment of Filing Fee (Check the appropriate box):

No fee required.

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1)
Title of each class of securities to which transaction applies:
(2)
Aggregate number of securities to which transaction applies:
(3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
(4)
Proposed maximum aggregate value of transaction:
(5)
Total fee paid:

Fee paid previously with preliminary materials.

Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
(1)
Amount Previously Paid:
(2)
Form, Schedule or Registration Statement No.:
(3)
Filing Party:
(4)
Date Filed:

 
[MISSING IMAGE: lg_crackers-pms.jpg]
Dear Shareholder:
We have enclosed with this letter the proxy statement for our 2021 Annual Meeting (the “Annual Meeting”) of shareholders of Cracker Barrel Old Country Store, Inc. (“Cracker Barrel” or the “Company”).
This year’s Annual Meeting will be held on Thursday, November 18, 2021, at 10:00 am Central Time. We currently plan to conduct the meeting in person at our offices at 305 Hartmann Drive, Lebanon, Tennessee 37087. We continue to be mindful of the public health concerns posed by the coronavirus (COVID-19) pandemic. Consistent with last year’s annual meeting of shareholders, we want to ensure that shareholders fully understand that because of the pandemic, the Annual Meeting this year will be different from years past and urge them to fully consider the changes to the meeting format described below before attending in person.
Measures that we intend to follow to protect the safety of shareholders, members of our Board of Directors, and our employees and facilities at this year’s Annual Meeting are expected to include:

requiring proof of vaccination or a negative COVID-19 test result received within the preceding 72 hours;

conducting health screenings for persons seeking entry to the meeting;

enforcing social distancing guidelines for all attendees, which may include dispersed seating of attendees in multiple rooms with video and audio streams;

requiring attendees to wear appropriate facial coverings while in our facilities;

refraining from any facility tours;

providing no food or beverage service;

providing no shareholder gifts or materials other than ballots and rules of procedure; and

streamlining the meeting itself to ensure that it is conducted as expeditiously and safely as possible.
As the pandemic and the public health response to it continue to evolve, we may impose additional procedures or limitations on meeting attendees or may decide to hold the meeting in a different location or solely by means of remote communication (i.e., a virtual-only meeting). We will issue a press release and make a public filing with the Securities and Exchange Commission (the “SEC”) announcing any changes to the Annual Meeting, and we will also announce any changes at http://investor.crackerbarrel.com. We encourage you to check this website prior to the Annual Meeting if you are considering attending. Most of all, we urge all of our shareholders to consider carefully the risks inherent in travel and in attending public gatherings such as the Annual Meeting in the continuing pandemic before making any decision to attend in person.
At the Annual Meeting, you will have an opportunity to vote (by proxy or in person) on the following proposals: (1) to elect ten directors; (2) to approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in the accompanying proxy statement; (3) to approve the Company’s shareholder rights plan, which was adopted by our Board of Directors on April 9, 2021; (4) to ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for our 2022 fiscal year; and (5) to vote on a shareholder proposal, if properly presented at the Annual Meeting.
In addition to the matters that will be voted on by shareholders at the Annual Meeting, the other members of the Board of Directors and I would like to express our heartfelt thanks to our fellow director, Norm Johnson, who will retire from the Board at the time of the Annual Meeting. Norm’s engagement over the years has been a tremendous resource for me, our Board and our Company, and his leadership as the chair of the Nominating and Corporate Governance committee has been instrumental in developing what
 

 
we believe to be an incredibly talented, diverse group of Board members with a broad and deep array of skills and experiences that are vital to supporting our corporate mission and the creation of value for our shareholders. Norm’s contributions will be deeply missed, but his work has positioned us well as we look ahead. We wish him well in future endeavors and thank him for his service.
This year, we have elected to provide access to our proxy materials over the Internet under the SEC’s “notice and access” rules.
Whether or not you expect to be present at the Annual Meeting, please vote and submit your proxy as soon as possible via the Internet, by phone, or, if you have requested to receive printed proxy materials, by mailing a proxy card enclosed with those materials. This will not prevent you from voting in person at the Annual Meeting, but will help to secure a quorum and avoid added solicitation costs. If you decide later to attend the Annual Meeting, you may withdraw your proxy at any time and vote your shares in person. We want your vote to be represented at the Annual Meeting.
Sincerely,
[MISSING IMAGE: sg_sandracochran-bw.jpg]
Sandra B. Cochran
President and Chief Executive Officer
October 7, 2021
 

 
[MISSING IMAGE: lg_crackers-pms.jpg]
305 Hartmann Drive
Lebanon, Tennessee 37087
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
IMPORTANT NOTICE REGARDING COVID-19 AND PROCEDURES FOR THE
ANNUAL MEETING:
      The Company currently plans to conduct the meeting in person. The Company continues to be mindful of the public health concerns posed by the pandemic. Consistent with last year, the Company wants to ensure that shareholders fully understand that because of the pandemic, the Annual Meeting this year will be different from years past and urges them to fully consider the changes to the meeting format described below before attending in person.
      Measures that the Company intends to follow to protect the safety of shareholders, members of the Board of Directors, and its employees and facilities at this year’s Annual Meeting are expected to include:

requiring proof of vaccination or a negative COVID-19 test result received within the preceding 72 hours;

conducting health screenings for persons seeking entry to the meeting;

enforcing social distancing guidelines for all attendees, which may include dispersed seating of attendees in multiple rooms with video and audio streams;

requiring attendees to wear appropriate facial coverings while in our facilities;

refraining from any facility tours;

providing no food or beverage service;

providing no shareholder gifts or materials other than ballots and rules of procedure; and

streamlining the meeting itself to ensure that it is conducted as expeditiously and safely as possible.
      As the pandemic continues to evolve, the Company may impose additional procedures or limitations on meeting attendees or may decide to hold the meeting in a different location or solely by means of remote communication (i.e., a virtual-only meeting). The Company will issue a press release and make a public filing with the SEC announcing any changes to the Annual Meeting, and the Company will also announce any changes at http://investor.crackerbarrel.com. Shareholders are encouraged to check this website prior to making any decision to attend the Annual Meeting.
The Company urges all shareholders to consider carefully the risks inherent in travel and in attending public gatherings such as the Annual Meeting in the continuing pandemic before making any decision to attend in person.
 

 
DATE OF MEETING:
November 18, 2021
TIME OF MEETING:
10:00 a.m. Central Time
PLACE OF MEETING:
305 Hartmann Drive, Lebanon, Tennessee 37087
ITEMS OF BUSINESS:
(1)
to elect ten directors;
(2)
to approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in the proxy statement that accompanies this notice;
(3)
to approve the Company’s shareholder rights plan, which was adopted by our Board of Directors on April 9, 2021;
(4)
to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the 2022 fiscal year;
(5)
to vote on a shareholder proposal, if properly presented at the Annual Meeting; and
(6)
to conduct other business properly brought before the meeting.
WHO MAY VOTE/
RECORD DATE:

You may vote if you were a shareholder at the close of business on September 17, 2021.
NOTICE AND ACCESS
We are mailing a Notice of Internet Availability of Proxy Materials (the “Notice”) to many of our shareholders instead of paper copies of our proxy statement and our 2021 Annual Report. The Notice contains instructions on how to access those documents over the Internet. The Notice also contains instructions on how shareholders can receive a paper copy of our proxy materials, including this proxy statement, our 2021 Annual Report and proxy card.
Whether or not you plan to attend the Annual Meeting, we ask that you vote as soon as possible. Promptly voting will help ensure that the greatest number of shareholders will be present whether in person or by proxy. You may vote over the Internet, as well as by telephone, or, if you requested to receive printed proxy materials, by mailing a proxy card enclosed with those materials. Please review the instructions on each of your voting options described in this proxy statement, as well as in the Notice you received in the mail.
If you attend the Annual Meeting in person, you may revoke your proxy at the meeting and vote your shares in person. You may revoke your proxy at any time before the proxy is exercised. Should you desire to revoke your proxy, you may do so as provided in the accompanying proxy statement.
By Order of our Board of Directors,
[MISSING IMAGE: sg_richardwolfson-bw.jpg]
Richard M. Wolfson
Secretary
Lebanon, Tennessee
October 7, 2021
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS
FOR THE SHAREHOLDER MEETING
TO BE HELD ON NOVEMBER 18, 2021:
The Notice of Internet Availability of Proxy Materials, Notice of Meeting and
Proxy Statement are available free of charge at: www.proxyvote.com
 

 
CRACKER BARREL OLD COUNTRY STORE, INC.
305 Hartmann Drive
Lebanon, Tennessee 37087
Telephone: (615) 444-5533
PROXY STATEMENT FOR 2021 ANNUAL MEETING OF SHAREHOLDERS
TABLE OF CONTENTS
1
4
8
14
14
40
41
41
43
44
45
47
47
47
48
50
51
51
53
53
54
57
66
67
71
71
72
74
76
76
76
 
i

 
GENERAL INFORMATION
What is this document?
This document is the proxy statement of Cracker Barrel Old Country Store, Inc. that is being furnished to shareholders in connection with our Annual Meeting of Shareholders to be held on Thursday, November 18, 2021 (the “Annual Meeting”). If you requested a printed version of the proxy statement, a form of proxy card is also being furnished with this document.
We have tried to make this document simple and easy to understand. The Securities and Exchange Commission (the “SEC”) encourages companies to use “plain English,” and we will always try to communicate with you clearly and effectively. We will refer to Cracker Barrel Old Country Store, Inc. throughout this proxy statement as “we,” “us,” the “Company” or “Cracker Barrel.” Unless clearly indicated otherwise, all references to a particular year or quarter in this proxy statement refer to our fiscal year or quarter.
Why am I receiving a proxy statement?
You are receiving this document because you were one of our shareholders at the close of business on September 17, 2021, the record date for our Annual Meeting. We are sending this proxy statement and the form of proxy card to you in order to solicit your proxy (i.e., your permission) to vote your shares of Cracker Barrel stock upon certain matters at the Annual Meeting. We are required by law to convene an Annual Meeting of our shareholders at which directors are elected. Because our shares are widely held, it would be impractical, if not impossible, for our shareholders to meet physically in sufficient numbers to hold a meeting. Accordingly, proxies are solicited from our shareholders. United States federal securities laws require us to send you this proxy statement and specify the information required to be contained in it.
What does it mean if I receive more than one proxy statement or proxy card?
If you receive multiple proxy statements or proxy cards, this may mean that you have more than one account with brokers or our transfer agent. Please vote ALL of your shares. We also recommend that you contact your broker and our transfer agent to consolidate as many accounts as possible under the same name and address. Our transfer agent is American Stock Transfer & Trust Company (“AST”). You can contact AST by calling (800) 485-1883.
Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?
Pursuant to rules adopted by the SEC, the Company will use the Internet as the primary means of furnishing proxy materials to shareholders. Accordingly, the Company is sending a Notice to the Company’s shareholders. All shareholders will have the ability to access the proxy materials on the website referred to in the Notice or request a printed set of the complete proxy materials. Instructions on how to access the proxy materials over the Internet or to request a printed copy may be found in the Notice. In addition, shareholders may request to receive proxy materials in printed form by mail or electronically by email on an ongoing basis. The Company encourages shareholders to take advantage of the availability of the proxy materials on the Internet to help reduce the environmental impact of its annual meetings and the cost to the Company associated with the physical printing and mailing of materials.
How can I get electronic access to the proxy materials?
The Notice explains how to:

view the Company’s proxy materials for the Annual Meeting on the Internet; and

instruct the Company to send future proxy materials to you by email.
The Company’s proxy materials are also available on the Company’s website at
http://investor.crackerbarrel.com.
 
1

 
Are you “householding” for shareholders sharing the same address?
Yes. The SEC’s rules regarding the delivery of proxy materials to shareholders permit us to deliver a single copy of these documents to an address shared by two or more of our shareholders. This method of delivery is called “householding,” and it can significantly reduce our printing and mailing costs. It also reduces the volume of mail you receive. Under this procedure, we are delivering a single copy of the Notice and, if applicable, the proxy materials to multiple shareholders who share the same address. Shareholders who participate in householding will continue to be able to access and receive separate proxy cards. Upon written request, we will deliver promptly a separate copy of the Notice and, if applicable, the proxy materials to any shareholder at a shared address to which we delivered a single copy of any of these documents. To receive a separate copy of the Notice and, if applicable, this proxy statement or the 2021 Annual Report, shareholders may call our transfer agent, AST, toll free at (800) 485-1883, or write to our Corporate Secretary at Cracker Barrel Old Country Store, Inc., 305 Hartmann Drive, Lebanon, Tennessee 37087. The same phone number and address may be used to notify us that you wish to receive a separate set of proxy materials in the future, or to request delivery of a single copy of our proxy materials if you are receiving multiple copies.
Who pays for the Company’s solicitation of proxies?
We will pay for the entire cost of soliciting proxies on behalf of the Company. We will also reimburse brokerage firms, banks and other agents for the cost of forwarding the Company’s proxy materials to beneficial owners. In addition, our directors and employees may solicit proxies in person, by mail, by telephone, via the Internet, press releases or advertisements. Directors and employees will not be paid any additional compensation for soliciting proxies, but Okapi Partners, LLC, our proxy solicitor, will be paid a fee, not expected to exceed $10,000, for rendering solicitation services.
Who may attend the Annual Meeting?
The Annual Meeting is open to all of our shareholders. To attend the meeting, you will need to register upon arrival. We also may check for your name on our shareholders’ list and ask you to produce valid identification. If your shares are held in “street name” by your broker or bank, you should bring your most recent brokerage account statement or other evidence of your share ownership. If we cannot verify that you own Cracker Barrel shares, it is possible that you will not be admitted to the meeting.
In light of the continuing pandemic, the Annual Meeting will be conducted in strict compliance with preventive measures recommended by public health experts. These measures are expected to include requiring proof of vaccination or a negative COVID-19 test result received within the preceding 72 hours; conducting health screenings for persons seeking entry to the meeting, enforcing social distancing guidelines for all attendees including seating attendees in separate rooms with audio and video streams, requiring attendees to wear appropriate facial coverings while in our facilities, refraining from any facility tours or food and beverage service, and streamlining the meeting itself to ensure that it is conducted as safely as possible. We must reserve the right to deny admission to the meeting for persons exhibiting symptoms or behavior that could place our shareholders, employees or facilities at risk.
For these reasons, we strongly urge shareholders to submit a proxy to vote your shares in advance of the Annual Meeting by submitting a proxy card, or by voting over the telephone or on the Internet. Submitting a proxy will not prevent you from voting in person, but it will help to secure a quorum, avoid added solicitation costs, and protect the health and safety of our employees, advisors and other shareholders. Information on how to submit a proxy to vote your shares in advance of the Annual Meeting is discussed below.
What if I have a disability?
If you are disabled and would like to participate in the Annual Meeting, we can provide reasonable assistance. Please send any request for assistance to Cracker Barrel Old Country Store, Inc., 305 Hartmann Drive, Lebanon, Tennessee, 37087, Attention: Corporate Secretary, at least two weeks before the meeting.
 
2

 
What is Cracker Barrel Old Country Store, Inc. and where is it located?
We are the owner and operator of the Cracker Barrel Old Country Store® restaurant and retail concept throughout the United States. We also own and operate the Maple Street Biscuit Company restaurant concept in a number of locations in the southeastern United States. Our corporate headquarters are located at 305 Hartmann Drive, Lebanon, Tennessee 37087. Our telephone number is (615) 444-5533.
Where is Cracker Barrel Old Country Store, Inc. common stock traded?
Our common stock is traded and quoted on the Nasdaq Global Select Market (“Nasdaq”) under the symbol “CBRL.”
Who will count the votes cast at the Annual Meeting?
The Board of Directors will appoint an independent inspector of election to serve at the Annual Meeting. The independent inspector of election for the Annual Meeting will determine the number of votes cast by holders of common stock for all matters. Final results will be announced when certified by the independent inspector of election, which we expect will occur within a few business days after the date of the Annual Meeting.
How can I find the voting results of the Annual Meeting?
We will include the voting results in a Current Report on Form 8-K, which we will file with the SEC no later than four business days following the completion of the Annual Meeting.
 
3

 
VOTING MATTERS
What am I voting on?
You will be voting on the following matters:

to elect ten directors;

to approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in this proxy statement;

to approve the Company’s shareholder rights plan, which was adopted by our Board of Directors on April 9, 2021;

to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our 2021 fiscal year; and

to vote on a shareholder proposal, if properly presented at the Annual Meeting.
Who is entitled to vote?
You may vote if you owned shares of our common stock at the close of business on September 17, 2021. As of September 17, 2021, there were 23,511,862 shares of our common stock outstanding.
How many votes must be present to hold the Annual Meeting?
In order to lawfully conduct the Annual Meeting, a majority of our outstanding common shares as of September 17, 2021 must be present at the Annual Meeting either in person or by proxy. This is called a quorum. Your shares are counted as present at the Annual Meeting if you attend the Annual Meeting and vote in person or if you properly return a proxy by one of the methods described below under the question “How do I vote before the Annual Meeting?” Abstentions and “broker non-votes” ​(as explained below under the question “What is a ‘broker non-vote’?”) also will be counted for purposes of establishing a quorum.
How many votes do I have and can I cumulate my votes?
You have one vote for every share of our common stock that you own. Cumulative voting is not permitted.
May I vote my shares in person at the Annual Meeting?
Yes. You may vote your shares at the Annual Meeting if you attend in person, even if you previously submitted a proxy card or voted by Internet or telephone. Whether or not you plan to attend the Annual Meeting in person, however, in order to assist us in tabulating votes at the Annual Meeting, we encourage you to vote by using the telephone, Internet or, if applicable, by returning a proxy card. It is possible the time, date, location or logistics of the meeting may be changed, including by holding a virtual meeting. In that case, we will issue a press release and make a public filing with the SEC, announcing any changes to the meeting, and we will also announce any changes at http://investor.crackerbarrel.com. We encourage you to check our website prior to the Annual Meeting if you plan to attend.
In light of the ongoing COVID-19 pandemic, the Annual Meeting will be conducted in strict compliance with limitations on public gatherings mandated by state and local authorities and other preventive measures recommended by public health experts. These measures are expected to include requiring proof of vaccination or a negative COVID-19 test result received within the preceding 72 hours, conducting health screenings for persons seeking entry to the meeting, enforcing optimal social distancing guidelines for all attendees, including possibly dispersed seating of attendees in multiple rooms with video and audio streams, requiring all attendees to wear appropriate facial coverings while in our facilities, refraining from any facility tours or food and beverage service, and streamlining the meeting itself to ensure that it is conducted as expeditiously and safely as possible. We must reserve the right to deny admission to the meeting for persons exhibiting symptoms or behavior that could place our shareholders, employees or facilities at risk.
 
4

 
For these reasons, we strongly urge shareholders to submit a proxy to vote your shares in advance of the Annual Meeting by using the telephone, Internet or, if applicable, by returning a proxy card. Submitting a proxy will not prevent you from voting in person, but it will help to secure a quorum, avoid added solicitation costs, and protect the health and safety of our employees, advisors and other shareholders. Information on how to submit a proxy to vote your shares in advance of the Annual Meeting is discussed below.
How do I vote before the Annual Meeting?
Before the Annual Meeting, you may vote your shares in one of the following three ways: (1) via the Internet by following the instructions provided in the Notice, (2) by mail, if you requested printed copies of the proxy materials, by filling out the form of proxy card and sending it back in the envelope provided, or (3) by telephone, if you requested printed copies of the proxy materials, by calling the toll free number found on the proxy card. If you requested printed copies of the proxy materials, and properly sign and return your proxy card and return it in the prepaid envelope, your shares will be voted as you direct.
Please use only one of the three ways to vote. If you hold shares in the name of a broker, your ability to vote those shares by Internet or telephone depends on the voting procedures used by your broker, as explained below under the question “How do I vote if my broker holds my shares in ‘street name’?” The Tennessee Business Corporation Act provides that a shareholder may appoint a proxy by electronic transmission, so we believe that the Internet or telephone voting procedures available to shareholders are valid and consistent with the requirements of applicable law.
How do I vote if my broker holds my shares in “street name”?
If your shares are held in a brokerage account in the name of your bank or broker (this is called “street name”), your bank or broker will send you the Notice. Many (but not all) brokerage firms and banks participate in a program provided through Broadridge Financial Solutions, Inc. that offers Internet and telephone voting options.
What is a “broker non-vote”?
If you own shares through a broker in street name, you may instruct your broker how to vote your shares. A “broker non-vote” occurs when you fail to provide your broker with voting instructions at least 10 days before the Annual Meeting and the broker does not have the discretionary authority to vote your shares on a particular proposal because the proposal is not a “routine” matter under applicable rules. See “How will abstentions and broker non-votes be treated?” and “Will my shares held in street name be voted if I do not provide my proxy?” below.
How will abstentions and broker non-votes be treated?
Abstentions and broker non-votes will be treated as shares that are present and entitled to vote for purposes of determining whether a quorum is present, but will not be counted as votes cast either in favor of or against a particular proposal, unless such proposal is a “routine” matter under applicable rules. See “Will my shares held in street name be voted if I do not provide my proxy?” below. The only “routine” matter to be presented at the Annual Meeting is Proposal 4: Ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm.
Will my shares held in street name be voted if I do not provide my proxy?
On certain “routine” matters, brokerage firms have the discretionary authority to vote shares for which their customers do not provide voting instructions. The only “routine” matter to be presented at the Annual Meeting is Proposal 4: Ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm.
How will my proxy be voted?
The individuals named on the proxy card will vote your proxy in the manner you indicate on the proxy card.
 
5

 
What if I return my signed proxy card or complete Internet or telephone procedures but do not specify my vote?
If you sign and return your proxy card or complete the Internet or telephone voting procedures but do not specify how you want to vote your shares, we will vote them:

FOR the election of each of the ten director nominees named in this proxy statement;

FOR the approval, on an advisory basis, of the compensation of the Company’s named executive officers as disclosed in this proxy statement;

FOR the approval of the Company’s shareholder rights plan;

FOR ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our 2022 fiscal year; and

AGAINST the shareholder proposal, if properly presented at the Annual Meeting, requesting that the Company adopt a policy that all shareholder meetings be held, in whole or in part, through virtual means.
Can I change my mind and revoke my proxy?
Yes. To revoke a proxy given pursuant to this solicitation, you must:

sign another proxy with a later date and return it to our Corporate Secretary at Cracker Barrel Old Country Store, Inc., 305 Hartmann Drive, Lebanon, Tennessee 37087 at or before the Annual Meeting;

provide our Corporate Secretary with a written notice of revocation dated later than the date of the proxy at or before the Annual Meeting;

re-vote by using the telephone and calling (800) 690-6903;

re-vote by using the Internet by following the instructions in the Notice; or

attend the Annual Meeting and vote in person — note that attendance at the Annual Meeting will not revoke a proxy if you do not actually vote at the Annual Meeting.
What vote is required to approve each proposal?

Proposal 1: Election of ten directors.
The affirmative vote of a plurality of the votes cast by the shareholders entitled to vote at the Annual Meeting is required for the election of directors. A properly executed proxy card marked “WITHHOLD” with respect to the election of a director nominee will be counted for purposes of determining whether there is a quorum at the Annual Meeting, but will not be considered to have been voted for the director nominee. Broker non-votes will also not be considered to have been voted for any director nominee.

Proposal 2: Approval, on an advisory basis, of the compensation of the Company’s named executive officers as disclosed in the proxy statement that accompanies this notice.
The compensation of the Company’s named executive officers as described in this proxy statement will be approved if the number of shares of Company common stock voted “FOR” the proposal exceeds the number of shares of Company common stock voted “AGAINST.” If you vote “ABSTAIN” on this proposal via a properly executed proxy card, the Internet or telephone, your vote will not be counted as cast “FOR” or “AGAINST” this proposal. Broker non-votes likewise will not be treated as cast “FOR” or “AGAINST” this proposal. Accordingly, neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.

Proposal 3: Approval of the Company’s shareholder rights plan.
We are asking our shareholders to approve the shareholder rights plan that our Board of Directors adopted on April 9, 2021. The Company’s shareholder rights plan will be approved if the number of shares of Company common stock voted “FOR” the proposal exceeds the number of shares of Company common stock voted “AGAINST.” If you vote “ABSTAIN” on this proposal via a properly executed proxy
 
6

 
card, the Internet or telephone, your vote will not be counted as cast “FOR” or “AGAINST” this proposal. Broker non-votes likewise will not be treated as cast “FOR” or “AGAINST” this proposal. Accordingly, neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.

Proposal 4: Ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our 2022 fiscal year.
Shareholder ratification of the appointment of our independent registered public accounting firm is not required, but the Board of Directors is submitting the appointment of Deloitte & Touche LLP for ratification in order to obtain the views of our shareholders. This proposal will be approved if the votes cast “FOR” the proposal exceed the votes cast “AGAINST” the proposal. If you submit a properly executed proxy card or use the Internet or telephone to indicate “ABSTAIN” on this proposal, your vote will not be counted as cast on this proposal. This proposal is considered routine, and thus if you hold your shares in street name, your broker may vote your shares for you absent any other instructions from you. Abstentions will not have any legal effect on whether this proposal is approved. If the appointment of Deloitte & Touche LLP is not ratified, the Audit Committee will reconsider its appointment.

Proposal 5: Shareholder proposal requesting that the Company adopt a policy that shareholder meetings be held, in whole or in part, through virtual means.
If properly presented at the Annual Meeting, the shareholder proposal described in this proxy statement will be approved if the number of shares of Company common stock voted “FOR” the proposal exceeds the number of shares of Company common stock voted “AGAINST.” If you vote “ABSTAIN” on this proposal via a properly executed proxy card, the Internet or telephone, your vote will not be counted as cast “FOR” or “AGAINST” this proposal. Broker non-votes likewise will not be treated as cast “FOR” or “AGAINST” this proposal. Accordingly, neither abstentions nor broker non-votes will have any legal effect on whether this proposal is approved.
How do you recommend that I vote on these items?
The Board of Directors recommends that you vote:

FOR the election of each of the ten director nominees named in this proxy statement;

FOR the approval, on an advisory basis, of the compensation of the Company’s named executive officers as disclosed in this proxy statement;

FOR the approval of the Company’s shareholder rights plan;

FOR ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our 2022 fiscal year; and

AGAINST the shareholder proposal requesting that the Company adopt a policy that all shareholder meetings be held, in whole or in part, through virtual means.
May other matters be raised at the Annual Meeting; how will the Annual Meeting be conducted?
We have not received proper notice of, and are not aware of, any business to be transacted at the Annual Meeting other than as indicated in this proxy statement. Under Tennessee law and our governing documents, no other business aside from procedural matters may be raised at the Annual Meeting unless proper notice has been given to us by the shareholders seeking to bring such business before the Annual Meeting. If any other item or proposal properly comes before the Annual Meeting, the proxies received will be voted on such matter in accordance with the discretion of the proxy holders.
The Chairman has broad authority to conduct the Annual Meeting so that the business of the Annual Meeting is carried out in a safe, orderly and timely manner. In doing so, he has broad discretion to establish reasonable rules for discussion, comments and questions during the Annual Meeting. The Chairman is also entitled to rely upon applicable law regarding disruptions or disorderly conduct to ensure that the Annual Meeting proceeds in a manner that is fair to all participants.
 
7

 
BOARD OF DIRECTORS AND COMMITTEES
Directors
The names and biographies of each member of our Board of Directors are set forth in this proxy statement under “PROPOSAL 1: ELECTION OF DIRECTORS,” beginning on page 57 of this proxy statement. All of the current members of our Board of Directors, other than Mr. Johnson, are nominees for re-election to the Board. Mr. Johnson intends to retire as a director effective prior to the Annual Meeting and will not stand for re-election.
Board Meetings
Our Board of Directors met ten times during 2021. Each director attended at least 75% of the aggregate number of meetings of the full Board of Directors that were held during the period he or she was a director during 2021 and all meetings of the committee(s) on which he or she served that were held during the period he or she served on such committee in 2021.
Board Committees
Our Board of Directors has the following standing committees: Audit, Compensation, Nominating and Corporate Governance, Public Responsibility, and Executive. All members of the Audit, Compensation, Nominating and Corporate Governance and Public Responsibility committees are independent under the Nasdaq Stock Market Rules and our Corporate Governance Guidelines. Our Board of Directors has adopted a written charter for each of the committees, with the exception of the Executive Committee. Copies of the charters of each of the Audit, Compensation, Nominating and Corporate Governance, and Public Responsibility committees, as well as our Corporate Governance Guidelines, are posted on our website: www.crackerbarrel.com. Current information regarding all of our standing committees is set forth below:
Name of Committee and Members
Functions of the Committee
Number
of
Meetings
in 2021
AUDIT:
Carl T. Berquist, Chair
Norman E. Johnson*
Gisel Ruiz**
Andrea M. Weiss
* Mr. Johnson is not standing for re-election.
** Ms. Ruiz joined this Committee as of November 20, 2021.

Acts as liaison between our Board of Directors and independent auditors

Reviews and approves the appointment, performance, independence and compensation of independent
auditors

Has authority to hire, terminate and approve payments to the independent registered public accounting firm and other committee advisors

Is responsible for developing procedures to receive information and address complaints regarding our accounting, internal accounting controls or auditing matters

Reviews internal accounting controls and systems, including internal audit plans

Reviews results of the internal audit plan, the annual audit and related financial reports

Reviews quarterly earnings press releases and related financial reports

Reviews our significant accounting policies and any changes to those policies

Reviews policies and practices with respect to risk assessment and risk management, including assisting the Board of
7
 
8

 
Name of Committee and Members
Functions of the Committee
Number
of
Meetings
in 2021
Directors in fulfilling its oversight responsibility in respect of the Company’s overall enterprise risk management program

Reviews and pre-approves directors’ and officers’ related-party transactions and annually reviews ongoing arrangements with related parties and potential conflicts of interest

Reviews the appointment, performance and termination or replacement of the senior internal audit executive

Determines financial expertise and continuing education requirements of members of the committee
COMPENSATION:
Coleman H. Peterson, Chair
Thomas H. Barr
Meg G. Crofton
Gilbert Dávila*
* Mr. Dávila joined this Committee as of November 20, 2021.

Reviews management performance, particularly with respect to annual financial goals

Administers compensation plans and reviews and approves salaries, bonuses and equity compensation grants of executive officers, excluding the Chief Executive Officer for whom the committee makes a recommendation to the Board of Directors for its approval

Monitors compliance of directors and officers with our stock ownership guidelines

Evaluates the risk(s) associated with our compensation programs

Selects and engages independent compensation consultants and other committee advisors

Leads the Company’s succession planning efforts with respect to the Chief Executive Officer position and reports to our Board of Directors on that issue
5
NOMINATING AND CORPORATE GOVERNANCE:
Norman E. Johnson, Chair*
Meg G. Crofton**
Coleman H. Peterson
Gisel Ruiz**
* Mr. Johnson is not standing for re-election.
** Ms. Crofton and Ms. Ruiz joined this Committee as of November 20, 2021.

Identifies and recruits qualified candidates to fill positions on our Board of Directors

Considers nominees to our Board of Directors recommended by shareholders in accordance with the nomination procedures set forth in our bylaws

Reviews corporate governance policies and makes recommendations to our Board of Directors

Reviews and recommends the composition of the committees of our Board of Directors

Oversees annual performance review of our Board of Directors and the committees thereof

Oversees, on behalf of our Board of Directors, director succession planning and reports to our Board of Directors on that issue
3
PUBLIC RESPONSIBILITY:
Andrea M. Weiss, Chair
Thomas H. Barr

Assists the Board of Directors in fulfilling its oversight responsibility for those portions of the Company’s overall enterprise risk management program relating to potential threats to the Company’s brand
3
 
9

 
Name of Committee and Members
Functions of the Committee
Number
of
Meetings
in 2021
Carl T. Berquist
Gilbert Dávila*
* Mr. Dávila joined this Committee as of November 20, 2021.

Analyzes public policy trends and makes recommendations to the Board of Directors regarding how the Company can anticipate and adjust to these trends

Assist the Board in identifying, evaluating and monitoring social, political, legislative and environmental trends, issues and concerns

Annually reviews the policies, procedures and expenditures for the Company’s political activities, including political contributions and direct and indirect lobbying

Assist the Board in overseeing the Company’s environmental and other sustainability policies and programs and their impact on the Company’s business strategy

Reviews the Company’s progress in its diversity, equity and inclusion initiatives and compliance with the Company’s responsibilities as an equal opportunity employer

Reviews the Company’s human and workplace rights policies

Reviews and recommends procedures concerning the transmission of the Company’s positions on public policy and social issues via digital media outlets

Reviews any shareholder proposals that deal with public policy issues and makes recommendations to the Board of Directors regarding the Company’s response to such proposals
EXECUTIVE:
William W. McCarten, Chair
Sandra B. Cochran
Carl T. Berquist
Norman E. Johnson*
Coleman H. Peterson
Andrea M. Weiss
* Mr. Johnson is not standing for re-election.

Meets at the call of the Chief Executive Officer or Chairman of the Board

Meets when the timing of certain actions makes it appropriate to convene the committee rather than the entire Board of Directors

May carry out all functions and powers of our Board of Directors, subject to certain exceptions under applicable law

Advises senior management regarding actions contemplated by the Company whenever it is not convenient or appropriate to convene the entire Board of Directors
0
Board Leadership Structure
Our Board of Directors regularly considers the appropriate leadership structure for the Company, and believes that its current leadership structure, with an independent director (Mr. McCarten) serving as Chairman and Ms. Cochran serving as the Chief Executive Officer, best serves (i) the objectives of the Board of Directors’ oversight of management, (ii) the ability of the Board of Directors to carry out its roles and responsibilities on behalf of the shareholders, and (iii) the Company’s overall corporate governance. Mr. McCarten has served as the Company’s independent Board Chairman since September 2019.
Notwithstanding our current leadership structure, our Board of Directors has concluded that it is important for the Board of Directors to retain flexibility in exercising its judgment to determine whether the same individual should serve as both Chief Executive Officer and Chairman at any given point in time, rather than adhering to a formal standing policy on the subject. This approach allows our Board of Directors to use its considerable experience and knowledge to elect the most qualified director as Chairman, while
 
10

 
maintaining the ability to combine or separate the Chairman and Chief Executive Officer roles when appropriate. Accordingly, at different points in time, the Chief Executive Officer and Chairman roles may be held by the same person. At other times, as currently, they may be held by different individuals. In each instance, the decision on whether to combine or separate the roles is determined by what the Board of Directors believes is in the best interests of our shareholders, based on the circumstances at the time. By way of example, in the event of a departure of either our Chief Executive Officer or Chairman, the Board of Directors could reconsider the leadership structure and whether one individual was then suited to fulfill both roles, based on the individual’s experience and knowledge of our business and whether the directors considered it in the best interest of the Company to combine the positions.
Our Board of Directors will continue to evaluate the Company’s leadership structure on an ongoing basis to ensure that it is appropriate at all times.
Board Oversight of Risk Management
It is the responsibility of our senior management to develop, implement and manage our strategic plans, and to identify, evaluate, manage and mitigate the risks inherent in those plans. It is the responsibility of our Board of Directors to understand and oversee our strategic plans, the associated risks, and the steps that senior management is taking to manage and mitigate those risks. Our Board of Directors takes an active approach to its risk oversight role. This approach is bolstered by our Board of Directors’ leadership and committee structure, which ensures: (i) proper consideration and evaluation of potential enterprise risks by the full Board of Directors under the auspices of the Chairman, and (ii) further consideration and evaluation of discrete risks at the committee level. Furthermore, our Board and committees seek to set the appropriate “tone at the top” by their engaged oversight.
Our Board of Directors is comprised predominantly of independent directors (ten of our eleven current directors and nine of our ten director nominees), and all directors who served on the key committees of our Board of Directors (Audit, Compensation, Nominating and Corporate Governance, and Public Responsibility) during 2021 were independent under applicable Nasdaq Stock Market Rules and our Corporate Governance Guidelines. This system of checks and balances ensures that key decisions made by the Company’s most senior management, up to and including the Chief Executive Officer, are reviewed and overseen by the non-employee directors of our Board of Directors.
Risk management oversight by the full Board of Directors includes a comprehensive annual review of our overall strategic plans, including the risks associated with these strategic plans. Our Board of Directors also conducts an annual review, led by the Audit Committee, of the conclusions and recommendations generated by management’s enterprise risk management process. This process involves a cross-functional group of our senior management that identifies current and future potential risks facing us and ensures that actions are taken to manage and mitigate those potential risks. Our Board of Directors also has overall responsibility for leadership succession for our most senior officers and reviews succession plans each year.
In addition, our Board of Directors has delegated certain risk management oversight responsibilities to certain of its committees, each of which reports regularly to the full Board of Directors. In performing these oversight responsibilities, each committee has full access to management, as well as the ability to engage independent advisors. The Audit Committee has primary overall responsibility for overseeing our risk management. It oversees risks related to our financial statements, the financial reporting process, accounting and legal matters. The Audit Committee oversees the internal audit function and our ethics and compliance program. It also regularly receives reports regarding our most significant internal control and compliance risks, along with management’s processes for maintaining compliance within a strong internal control environment. In addition, the Audit Committee receives reports regarding potential cybersecurity/data privacy, legal and regulatory risks and management’s plans for managing and mitigating those risks. Representatives of our independent registered public accounting firm attend Audit Committee meetings, regularly make presentations to the Audit Committee and comment on management presentations. In addition, our Chief Financial Officer, Vice President of Internal Audit, General Counsel and representatives of our independent registered public accounting firm individually meet in private sessions with the Audit Committee to raise any concerns they might have with the Company’s risk management practices.
 
11

 
The Compensation Committee is responsible for overseeing our incentive compensation arrangements, for aligning such arrangements with sound risk management and long-term growth and for verifying compliance with applicable regulations. The Compensation Committee conducted an internal assessment of our executive and non-executive incentive compensation programs, policies and practices, including reviewing and discussing the various design features and characteristics of the Company-wide compensation policies and programs; performance metrics; and approval mechanisms of all incentive programs. Based on this assessment and after discussion with management and the Compensation Committee’s independent compensation consultant, the Compensation Committee has concluded that our incentive compensation arrangements and practices do not create risks that are reasonably likely to have a material adverse effect on the Company.
The Public Responsibility Committee oversees the risks associated with the Company’s response to public relations matters and public policy trends, including the Company’s environmental and social initiatives; diversity, equity and inclusion policies; and sustainability monitoring.
Finally, the Nominating and Corporate Governance Committee oversees risks associated with its areas of responsibility, including, along with the Audit Committee, our ethics and compliance program. The Nominating and Corporate Governance Committee also reviews annually our key corporate governance documents to ensure they are in compliance with the changing legal and regulatory environment and appropriately enable our Board of Directors to fulfill its oversight duties. In addition, our Board of Directors is routinely informed of developments at the Company that could affect our risk profile and business in general.
Compensation of Directors
Our Compensation Committee reviews the compensation we pay to our independent directors annually, in consultation with Frederic W. Cook & Co., the Compensation Committee’s outside compensation consultant (“FW Cook”), and recommends any changes in compensation to the entire Board for consideration and approval. The Compensation Committee’s recommendation to the Board takes into consideration the competitiveness of total compensation relative to our restaurant and retail industry peer companies (see pages 20-21 of this proxy statement for a discussion of our peer group) and similarly sized general industry companies. To assess the competitiveness of our director compensation program, FW Cook annually conducts a market assessment at the request of the Compensation Committee. FW Cook’s assessment of outside director compensation found the total compensation provided to Cracker Barrel’s outside directors to be generally aligned with median total compensation of the peer group and the median of similarly sized general industry companies.
Cash Compensation.   During the third and fourth quarters of fiscal 2020, the Board voluntarily approved a 50% reduction in the cash compensation payable to our independent directors in respect of our third and fourth quarters of fiscal 2020, in support of the Company’s response to the COVID-19 pandemic. In fiscal 2021, upon the Compensation Committee’s recommendation, the Board approved the director cash compensation amounts set forth in the following table, which reflected a return to Board compensation levels that were otherwise unchanged from those set at the start of fiscal 2020.
Independent Director Retainer
$ 75,000
Independent Board Chairman Retainer
$ 55,000
Audit Committee Retainers
Chair
$ 25,000
Member
$ 14,000
Compensation Committee Retainers
Chair
$ 20,000
Member
$ 12,500
Nominating and Governance Committee Retainers
Chair
$ 15,000
 
12

 
Member
$ 5,500
Public Responsibility Committee Retainers
Chair
$ 15,000
Member
$ 5,500
Executive Committee Retainers
$ None
The foregoing amounts are prorated for any outside director who joins the Board during the course of the fiscal year. In addition, we reimburse our outside directors for their reasonable and customary expenses incurred in travelling to and attending meetings.
Equity Compensation.   Each non-employee director other than the independent Chair who is elected at an annual meeting also receives a grant of restricted stock units (“RSUs”) having a value equal to approximately $110,000, with the number of RSUs included in such grant determined based on the closing price of our common stock on the date of the applicable annual meeting, as reported by Nasdaq, and rounded down to the nearest whole share. Our independent Chair receives an additional grant of RSUs having a value equal to approximately $65,000, for a total award having an approximate value of $175,000. The foregoing awards are prorated for any outside director who joins the Board during the course of the fiscal year.
All of the RSUs awarded to our independent directors vest at the earlier of one year from the date of grant or at the next annual meeting of shareholders. The Company has no knowledge of any agreement or arrangement between any director or director nominee and any person or entity other than the Company relating to compensation or other payment in connection with such person’s candidacy or service as a director.
Our non-employee directors are also offered the option to participate in a directors’ deferred compensation plan. This plan allows a participant to defer a percentage or sum of his or her compensation and earn interest on that deferred compensation at a rate equal to the 10-year Treasury bill rate (as in effect at the beginning of each calendar month) plus 1.5%. The compensation of our directors during 2021 is detailed in the Director Compensation Table, which can be found on page 50 of this proxy statement.
 
13

 
EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
This portion of the proxy statement, the Compensation Discussion and Analysis or “CD&A,” provides a description of the objectives and principles of our executive compensation programs. It explains how compensation decisions are linked to Cracker Barrel’s performance relative to our strategic goals and our efforts to drive shareholder value. It is also meant to give our shareholders insight into the deliberative process and the underlying compensation philosophies that are the foundation of the design of the pay packages of our executive officers, including our decisions regarding executive compensation in light of the continued reality of the COVID-19 pandemic (the “pandemic”).
Generally, Cracker Barrel’s executive compensation programs apply to all executive officers, but this CD&A is focused on the compensation decisions relating to our executive officers who qualified as “named executive officers” under applicable SEC rules (the “Named Executive Officers” or “NEOs”) during 2021. Our NEOs for 2021 were:

Sandra B. Cochran, President and Chief Executive Officer;

P. Douglas Couvillion, Senior Vice President, Interim Chief Financial Officer;

Jennifer L. Tate, Senior Vice President and Chief Marketing Officer;

Richard M. Wolfson, Senior Vice President, General Counsel and Corporate Secretary;

Michael T. Hackney, Senior Vice President of Restaurant and Retail Operations; and

Jill M. Golder, former Senior Vice President and Chief Financial Officer.

This CD&A is divided into five sections:
Section 1 – Executive Summary
Section 2 – Our Shareholder Engagement and Responses to Last Year’s Say on Pay Vote
Section 3 – Our Compensation Process and Philosophies
Section 4 – 2021 Compensation Programs, Including the Continued Impact of the COVID-19 Pandemic
Section 5 – Realizable Pay Analysis and Other Executive Compensation Policies and Guidelines
Section 1.   Executive Summary
The chart below provides an executive summary of the key topics of this CD&A, all of which are described in significantly greater detail further below:
Last Year’s Say on Pay Vote; Shareholder Engagement and Response

Our 2020 Say on Pay proposal did not receive majority support, in response to which we engaged with a significant number of our shareholders to seek their feedback on our 2020 executive compensation and better understand their concerns.

The feedback we received made it clear that shareholders who voted against Say on Pay in 2020 did so in response to specific pandemic-related incentive compensation decisions made in 2020. While no shareholder with whom we engaged expressed any concerns about our compensation programs and practices generally, our engagement effort did yield helpful feedback regarding plan design preferences and confirmation of changes already implemented for 2021.

In direct response to this feedback, our Compensation Committee is making certain changes effective for fiscal 2022 (which began in August 2021) to further strengthen the
 
14

 
pay-for-performance linkage of our compensation programs.

The most significant of these changes are that we will increase the performance period for performance-based equity awards from two years to three and impose an additional one-year holding period on vested equity awards. The shareholders with whom we engaged all expressed strong support for these measures.
Compensation Decisions for 2021
The pandemic continued to impact the Company and the casual dining industry throughout 2021, but, unlike 2020, we were able to design our compensation programs with the pandemic in mind.

Base Salary.   Neither our Chief Executive Officer nor any NEO other than Mr. Hackney received an increase in base salary or incentive compensation target percentage (bonus or LTI) in 2021.

Annual Bonus Plan.   Our Annual Bonus Plan for 2021 was a two-stage program and applied across the Company and not just to the NEOs.

In the first stage, the Company had to meet various objective and quantifiable operational and strategic metrics in order for participants to receive a maximum bonus at target.

In the second stage, the amount earned in the first stage could be adjusted from 0% to 125% depending upon the Company’s level of operating income. Bonuses were thus capped at 125% of target (down from a 200% cap in prior years).

LTI Program.   The Company issued fifty percent of the target value of each NEO’s LTI awards in the form of time-based restricted stock and the other fifty percent in the form of performance shares. The performance shares are capped at 150% of target (down from 200% in prior years) and will be awarded, if at all, based on (i) the Company’s relative TSR performance against a group of 23 publicly traded small and midcap restaurant companies over a two-year performance period, and (ii) the Company’s 2022 sales vs. 2019 (pre-pandemic).

No Other Changes.   We made no changes to the limited benefits/perquisites given to NEOs and no changes to existing severance or change in control agreements.
Compensation Peer Group

The peer group of 15 companies that our Compensation Committee uses to assist it in assessing our executive compensation practices and levels remained unchanged from 2020.
 
15

 
Continued Adherence to Existing Philosophies and Best Practices

We continue to adhere to our core philosophies of pay-for-performance, including making a majority of our NEO pay at-risk. For 2021, an average of 71% of our NEOs’ pay was at-risk. For our Chief Executive Officer, the percentage was 83%.

Core practices continue unchanged from prior years, including ensuring compensation programs do not incentivize undue risk-taking, targeting total NEO direct compensation at market median, requiring meaningful share ownership by our NEOs, and subjecting incentive compensation payments to robust recoupment and anti-hedging/anti-pledging policies.
Section 2.   Our Shareholder Engagement and Responses to Last Year’s Say on Pay Vote
Last year, we held our annual advisory vote to approve Named Executive Officer compensation, commonly known as “Say on Pay.” Approximately 63% of the votes cast (excluding broker non-votes and abstentions) were against our executive compensation as disclosed in our 2020 Proxy Statement, which included approximately two million votes cast by entities affiliated with Sardar Biglari (“Biglari”), a historically dissident shareholder who was then engaging in its fifth proxy contest with the Company in ten years. Leaving aside shares voted by Biglari, the Company believes that approximately 42% of the remaining votes were cast in favor of our executive compensation, while approximately 58% of the remaining votes were cast against.
This disappointing result was well below the high levels of support that our non-dissident shareholders have typically expressed for our executive compensation programs — with over 90% of such shareholders voting in support of our Say on Pay proposals for the three preceding years. In response to the 2020 voting results, our Board and senior management team undertook an extensive, in-depth shareholder engagement program to better understand their concerns. Specifically, in 2021 we reached out to each shareholder other than Biglari who held more than 0.5% of our outstanding stock, which shareholders collectively represented approximately 54% percent of our total ownership. We invited these shareholders to speak with our independent Board chair, William McCarten, and members of our senior management team, to discuss executive compensation and other matters that might be of concern or interest to them, including our performance, corporate governance, and sustainability efforts. These shareholders included both shareholders who voted against last year’s Say on Pay resolution and shareholders who voted in favor of it.
Of the shareholders to whom we reached out, shareholders who collectively represented 37% of our outstanding common stock accepted our invitation to engage in direct discussions and, in one case, by written correspondence. As detailed further below, we received meaningful feedback from these shareholders that was communicated to our Compensation Committee and our Board. The table below summarizes what we heard and what our Compensation Committee did in response. As noted below, due to the timing of last year’s Say on Pay vote and our ensuing discussions with these shareholders, several of our Compensation Committee’s responsive decisions could not be implemented for fiscal year 2021 (which began August 1, 2020) and will be implemented in September 2021 for our fiscal year 2022.
 
16

 
Feedback Theme
Specific Shareholder Feedback
Our Response
Overall Executive Compensation Philosophy and Practices

Shareholders who voted against our 2020 Say on Pay consistently told us they did so because they disagreed with certain pandemic-related decisions we made in 2020 with respect to outstanding incentive compensation awards, rather than to express concern about our compensation programs generally.

In the event of a highly disruptive event akin to the pandemic in the future, our Compensation Committee and Board remain committed to carefully considering how best to handle outstanding incentive compensation awards, particularly outstanding performance-based equity awards, and would intend to engage with shareholders before finalizing decisions.
Pay-for-Performance Linkage

Shareholders would prefer that our performance-based LTI awards feature a longer performance period.

Beginning in September 2021 (which is in our fiscal 2022), our performance-based equity awards have a three-year performance period, an increase from the two-year performance period for all prior performance-based equity awards.

Shareholders expressed support for the 50/50 split between time-based and performance-based LTI awards featured in our FY21 LTI awards.

For both fiscal 2021 and 2022, the target value of our LTI awards were divided equally between time-based and performance-based awards.
Alignment of Executives’ Interests with Long-Term Shareholders, and Compensation Risk Mitigation

Shareholders favored longer-term ownership of Company stock held by management.

In addition to extending the performance period of the performance-based equity awards from two to three years, all incentive equity awards granted after September 2021 (which is in our fiscal 2022) will be subject to a one-year post-vesting holding period.
Below we provide more detailed narrative descriptions of the shareholder feedback we received and our responses.
Shareholder Feedback
Every shareholder with whom we engaged and who voted against our executive compensation in 2020 confirmed that they did so because of isolated incentive compensation decisions that were made last year in response to the unprecedented impact of the pandemic. A detailed summary of these decisions, including the philosophies and rationales underlying them, is set forth in our 2020 Proxy Statement.
Conversely, a number of our shareholders, including our largest shareholder last year, told us they agreed with the decisions we made in 2020 and voted in favor of our 2020 Say on Pay resolution. These shareholders told us that they agreed with the actions the Company took to handle pandemic-impacted incentive compensation in 2020.
In speaking with our shareholders, we were pleased that none of them expressed any concerns about our executive compensation practices or philosophies generally or indicated that they found the design of
 
17

 
our compensation programs to be problematic or our executive compensation levels to be excessive. To the contrary, our shareholders consistently told us that our compensation programs, including our programs for 2021 that are described in greater detail below and were put into place before last year’s annual meeting and before our subsequent shareholder engagement campaign, appeared well-designed to align pay with performance and seemed in line with market norms as to structure, key features and potential payouts.
In addition, our shareholders consistently told us the following:

They support performance periods of three years rather than two for our performance-based equity awards.

They support a requirement that executives hold equity awards for an additional 12-month period following the vesting of such awards, whether performance-based or time-based.

They support a 50/50 split between performance-based and time-based equity awards in our LTI award packages, as they believe this represents an appropriate balance of performance and retention incentives.
Response to Feedback
The feedback we received in this shareholder engagement campaign was shared with the Compensation Committee and the Board. Because the results of our 2020 Say on Pay vote and associated shareholder engagement took place after our compensation plans for 2021 had already been approved, the Compensation Committee and the Board are considering the feedback for future compensation years. Although our compensation plans for 2022 are not yet finalized as of the date of this proxy statement, the Compensation Committee and the Board have made certain commitments in response to shareholder feedback, as follows.

Pandemic Decisions.   The Compensation Committee and Board will carefully consider different approaches in the event the Company is ever faced with similar incentive compensation decisions like the ones occasioned by the pandemic in 2020. Even if another pandemic is unlikely, the Compensation Committee and the Board acknowledge the possibility that the pandemic itself may take an unexpected turn or that another unexpected and highly disruptive event in the future could frustrate incentive compensation programs in the same manner as the pandemic did in 2020. The Committee and Board therefore agree that if such an event occurs, they may need to take a different approach to the treatment of outstanding performance-based incentive compensation awards than they did in 2020, and that it would be advisable to engage with our shareholders before doing so.

Performance Period.   Although our 2022 LTI plans are not yet finalized, the Compensation Committee has agreed to increase the performance period used for performance-based awards to three years from two, beginning with awards issued in September 2021 (which is the outset of the Company’s fiscal 2022).

Additional Holding Period.   Although our 2022 LTI plans are not yet finalized, the Compensation Committee has agreed that executives will be required to hold all performance-based and time-based shares for one year following the vesting of the underlying awards, beginning with awards issued in September 2021 (which is the outset of the Company’s fiscal 2022).

Time and Performance-Based Split.   The Compensation Committee had already determined that a 50/50 split between time-based and performance-based represented the appropriate balance between incentivizing retention and performance prior to issuing equity awards in 2021. The Compensation Committee plans to continue this practice once again in 2022.
Although the Compensation Committee and the Board did not have the benefit of knowing the results of our 2020 Say on Pay vote or subsequent shareholder feedback before designing our compensation programs for 2021, we described our 2021 programs to the shareholders with whom we engaged and solicited feedback after the fact. No shareholders expressed concern about any aspect of the programs, and all shareholders agreed that the programs appeared to be reasonable in light of the pandemic and aligned with shareholders’ interests. We describe our 2021 compensation programs in detail in Section 4 below.
 
18

 
Section 3.   Our Compensation Process and Philosophies
Compensation Philosophy
Our central compensation objective is to drive long-term total return to our shareholders and build a better company by implementing compensation programs that:

Reward both company-wide and individual performance,

Align our executives’ interests with those of our shareholders,

Allow us to attract and retain talented executives, and

Appropriately incentivize management without exposing the Company to undue levels of risk.
We have a strong “pay for performance” philosophy designed to:

Reward executives for maximizing our success, as determined by our performance relative to our financial and operational goals and relative to our industry,

Reward executives for both near-term and sustained longer-term financial and operating performance as well as leadership excellence,

Align the economic interests of executives with those of our shareholders, and

Encourage them to remain with the Company for long and productive careers.
The Company’s compensation philosophy is to target total direct compensation paid to our executive officers at the median of our peer group and other market comparators. While the Compensation Committee strives to deliver a target total compensation package approximating the market median, our compensation program design is robust enough to recognize individual performance, competitive pressures for management talent, experience, and value to the organization when establishing compensation opportunities. The Compensation Committee believes it utilizes elements of compensation that create appropriate flexibility and help focus and reward executives for both near-term and long-term performance while aligning the interests of executive officers with the interests of our shareholders.
Role of the Compensation Committee
Our Compensation Committee’s primary responsibility is the establishment and approval of compensation and compensation programs for our executive officers that further the overall objectives of our executive compensation program. In fulfilling this responsibility, the Compensation Committee:

Reviews and approves corporate performance goals for our executive officers;

Sets cash- and equity-based compensation for our executive officers;

Designs and administers our equity incentive arrangements;

Reviews and approves executive benefits and perquisites;

Assesses potential risks to the Company associated with our compensation programs and reviews;

Approves employment and change in control agreements of our executive officers;

Periodically conducts or authorizes studies of matters within its scope of responsibilities; and

Periodically retains, at the Company’s expense, independent counsel or other consultants necessary to assist the Compensation Committee in connection with any such studies.
The Compensation Committee makes compensation decisions after reviewing the performance of the Company and carefully evaluating both quantitative and qualitative factors such as an executive’s performance during the year against established goals, leadership qualities, operational performance, business responsibilities, long-term potential to enhance shareholder value, current compensation status as shown on tally sheets reflecting current and historical compensation for each executive, and tenure with the Company.
 
19

 
Role of Independent Compensation Consultant
To assist the Compensation Committee with establishing executive compensation, the Compensation Committee retains FW Cook to provide competitive market data, assist in establishing a peer group of companies and provide guidance on compensation structure as well as levels of compensation for our senior executives and the Board. Additionally, this year the Compensation Committee also engaged FW Cook to assist with the Compensation Committee’s assessment of pandemic-impacted compensation and advise on the approaches the Company and the Compensation Committee might take to address issues arising in connection therewith.
The Compensation Committee consulted with FW Cook in determining the compensation to be awarded to all of the Named Executive Officers, including Ms. Cochran, in 2021. FW Cook reports directly to the Compensation Committee. As required under the Nasdaq Stock Market Rules, the Compensation Committee has assessed the independence of FW Cook pursuant to applicable SEC and Nasdaq rules, including, but not limited to, those set forth in Rule 5605(d)(3)(D) of the Nasdaq Stock Market Rules, as applicable. The Compensation Committee concluded that no conflict of interest exists that would prevent FW Cook from serving as an independent consultant to the Compensation Committee.
Role of Management
Management plays the following roles in the compensation process:

Management recommends to our Board of Directors business performance targets and objectives for the annual plan and provides background information about the underlying strategic objectives;

Management evaluates employee performance;

Management recommends cash compensation levels and equity awards;

Management works with the Compensation Committee Chairman to establish the agenda for Compensation Committee meetings;

The Chief Executive Officer generally makes recommendations to the Compensation Committee regarding salary increases for other executive officers during the regular merit increase process;

The Chief Executive Officer provides her perspective on recommendations provided by FW Cook regarding compensation program design issues;

The Chief Executive Officer does not play a role in determining her own compensation; and

Other members of management, at the request of the Compensation Committee, work with FW Cook to provide data about past practices, awards, costs and participation in various plans, and information about our annual and longer-term goals. When requested by the Compensation Committee, selected members of management may also review FW Cook’s recommendations on plan design and structure and provide a perspective to the Compensation Committee on how these recommendations may affect recruitment, retention and motivation of our employees as well as how they may affect us from an administrative, accounting, tax or similar perspective.
Compensation Peer Group
The Compensation Committee evaluates a variety of factors in establishing an overall compensation program that best fits our overarching goals of maximizing shareholder return and building a stronger company. As one element of this evaluative process, the Compensation Committee, with the assistance of FW Cook, considers competitive market compensation paid by other similarly situated companies and attempts to maintain compensation levels and programs that are comparable to and competitive with those of a peer group of similarly situated companies. Although we do not expressly “benchmark” our compensation relative to that provided by our peers, the Compensation Committee does use the peer group data as a component of its analysis to ensure relative consistency at the median level of our peers. The peer group is reviewed annually by the Compensation Committee and is comprised of the following:

Organizations of similar business characteristics (i.e., publicly traded organizations in the restaurant and retail industries, given that our restaurants also feature a sizeable retail operation);
 
20

 

Organizations against which we compete for executive talent;

Organizations of comparable size to Cracker Barrel, as measured by primarily by sales but also by market capitalization, enterprise value, and other relevant factors; and

Organizations with similar geographic dispersion and workforce demographics.
The Company believes that the selection of a peer group to be used for assessing the competitiveness of its executive compensation levels is something that requires reconsideration every year. The Compensation Committee reviews the Company’s peer group on an annual basis and changes certain members of the peer group as the Compensation Committee refines the comparison criteria and when the Company and members of the peer group change in ways that make comparisons less or more appropriate.
The Compensation Committee conducted its annual review of the Company’s peer group in respect of 2021 compensation to confirm the alignment of the Company’s peer group with the Company as summarized above. After undertaking this review in respect of 2021, the Compensation Committee determined that the same peer group from 2020 remained appropriately aligned and that no changes were warranted. As a result, the peer group referenced as part of our determining 2021 compensation was comprised of the following 15 publicly-traded companies:

Big Lots, Inc.

Darden Restaurants, Inc.

Jack-in-the-Box, Inc.

Bloomin’ Brands, Inc.

Denny’s Corporation

Red Robin Gourmet Burgers, Inc.

Brinker International, Inc.

Dine Brands Global, Inc.

Tractor Supply, Inc.

Cheesecake Factory, Inc.

Domino’s Pizza, Inc.

The Wendy’s Company

Chipotle Mexican Grill, Inc.

Dunkin’ Brands Group, Inc.

Williams-Sonoma, Inc.
Management and the Compensation Committee regularly evaluate the marketplace to ensure that our compensation programs remain competitive. In addition to its review of data from the peer group, the Compensation Committee also from time to time consults data from published compensation surveys to assess more generally the competitiveness and the reasonableness of our compensation programs. To the extent that the Compensation Committee “benchmarks” compensation, it relies only on comparisons to the enumerated peer group and survey data. The Compensation Committee, however, does not believe that compensation levels and design should be based exclusively on benchmarking and, therefore, considers various business factors and each executive’s individual circumstances and role within our organization.
Compensation Risk Analysis
Each year, the Compensation Committee conducts an internal assessment of our executive and non-executive incentive compensation programs, policies and practices as part of its responsibilities under our broader risk management program and to ensure compliance with applicable regulations. In 2021, as part of this process the Compensation Committee reviewed and discussed the various design features and characteristics of the Company-wide compensation policies and programs, performance metrics, and approval mechanisms of all incentive programs. Based on this assessment and after discussion with management and FW Cook, the Compensation Committee has concluded that our incentive compensation arrangements and practices do not create risks that are reasonably likely to have a material adverse effect on the Company.
Overview of Compensation Elements
We believe our compensation programs are generally consistent with best practices for sound corporate governance.
 
21

 
What We Do
What We Do Not Do

Maintain robust stock ownership and retention guidelines for executives and non-executive directors;

Execute employment agreements containing multi-year guaranties for salary increases, or automatic renewals (i.e., evergreen agreements) for those executive officers that have employment agreements  —  currently only our Chief Executive Officer;

Conduct annual risk assessments of our compensation programs;

Provide material perquisites for executives;

Deliver a majority of the target value of our long-term incentive program (as calculated at the time of grant) through performance-contingent awards;

Offer gross-up payments to cover personal income taxes or excise taxes that pertain to executive or severance benefits;

Only accelerate equity upon change-in-control AND termination (“double trigger” vesting); and

Pay dividends on unvested LTI awards; or

Maintain anti-hedging, anti-pledging and recoupment (or “clawback”) policies.

Provide special executive retirement programs.
We strive to achieve an appropriate mix between cash payments and equity incentive awards in order to meet our objectives by rewarding recent results, motivating long-term performance, and strengthening alignment with shareholders. The Compensation Committee evaluates the overall total direct compensation package relative to market conditions but does not specifically target any percentile for each element of total direct compensation. In conducting this evaluation, the Compensation Committee’s goal is to ensure that a significant majority of each executive officer’s total direct compensation opportunity is contingent upon Company performance and shareholder value creation. The Compensation Committee reviews the compensation mix of each executive on a comprehensive basis to determine if we have provided the appropriate incentives to accomplish our compensation objectives.
In general, our compensation policies have provided for a more significant emphasis on long-term equity compensation than on annual cash compensation for our executive officers. The Compensation Committee believes that the Company’s 2021 pay mix as approved at the outset of 2021 supported the Company’s strong pay for performance culture, as demonstrated by the fact that approximately 83% of our Chief Executive Officer’s target total direct compensation and approximately 71% of our other Named Executive Officers’ target total direct compensation in 2021 were variable or at risk, as represented by the following charts:
[MISSING IMAGE: m2127874d1-pc_ceoneosbw.jpg]
 
22

 
Section 4.   2021 Compensation Programs, Including the Continued Impact of the COVID-19 Pandemic
COVID-19 Pandemic — Continued Material Impact
In our 2020 Proxy Statement, we described the sudden and dramatic impact that the pandemic had on the Company’s business in the second half of fiscal 2020. As we noted in our 2020 Proxy Statement, the pandemic was especially disruptive to the casual and family dining industries in which we operate, and particularly to concepts such as ours, which derive substantial revenues from breakfast and full dine-in service, and which serve a high number of travelers.
Throughout 2021, the pandemic continued to negatively impact the casual and family dining industries and the Company, particularly in the period before vaccinations became available and then again after the increase in infections and resulting restrictions brought about by the spread of the Delta variant of the virus throughout the United States. As a result, we spent much of the year responding to frequently-changing health and safety requirements, capacity and operational limitations, and shifting consumer and employee sentiment caused by “hot spots” and resurgence of the virus. For most of 2021, virtually all of our 665 Cracker Barrel stores throughout the United States faced meaningful capacity restrictions and a significant percentage of our restaurants were forced to limit operations to delivery or carry-out only during the course of the year.
Unlike 2020, when the pandemic suddenly arose midway through our fiscal year and forced the Compensation Committee and the Board to make compensation-related decisions based on unexpected and unprecedented circumstances, the Company began 2021 believing that the pandemic would continue to create significant uncertainty for our business prospects for most, if not all, of the year. As a result, the Compensation Committee was able to put in place compensation programs that were designed to strongly link executive pay to performance despite the uncertain environment while still ensuring that the Company is strategically positioned to grow as and when conditions improve. These are described in greater detail below.
The following table summarizes the basic elements of our compensation programs, describes the behavior and/or qualities that each element is designed to encourage, and identifies the underlying purpose for that element of our compensation program as well as key decisions that were made in respect of that element for 2021:
Pay Element
What the Pay Element Rewards
Purpose of the Pay Element / Decisions for
2021
Base Salary

Skills, experience, competence, performance, responsibility, leadership and contribution to the Company
Purpose:

Provide fixed compensation for daily responsibilities,
Decisions for 2021:

No NEO received an increase in base salary in 2021, with the exception of one individual who had been promoted but whose salary had not yet been adjusted to market levels.
Annual Bonus Plan

Annual achievement of objective performance targets.
Purpose:

Focus attention on meeting annual performance targets and our near-term success, provide additional cash compensation and incentives based on our annual performance.
 
23

 
Pay Element
What the Pay Element Rewards
Purpose of the Pay Element / Decisions for
2021
Decisions for 2021:

Due to the continued uncertainties of the pandemic, the 2021 Annual Bonus Plan was established as a two-stage program. In the first stage, participants were incentivized to achieve various objective and quantitative operational and strategic metrics that the Board deemed important to the Company’s short and long-term success, with a maximum possible payout of target. In the second stage, the first stage results were then modified, up or down, based on the Company’s achievement of operating income.

For participants to earn target bonuses in 2021, the Company had to earn more operating income than it did in 2020. For participants to earn more than target, the Company had to more than double its 2020 operating income.

In all events, bonus payouts were capped at 125% of target. The Company has traditionally capped payouts at 200%.
Long-Term Performance Incentives (Performance Shares)

Achieving multi-year performance goals and value creation
Purpose:

Focus attention on meeting longer-term performance targets and our long-term success, create alignment with shareholders by focusing efforts on longer-term financial and shareholder returns; Management retention.
Decisions for 2021:

Performance shares represent 50% of an NEO’s target award.

In 2021, performance shares were granted, and will be ultimately awarded, on the basis of (i) the Company’s relative TSR performance
 
24

 
Pay Element
What the Pay Element Rewards
Purpose of the Pay Element / Decisions for
2021
against a group of 23 publicly-traded small and mid-cap restaurant companies and (ii) 2022 vs. 2019 (pre-pandemic) revenues.

The payout of 2021 performance shares is capped at 150% of target. The Company has traditionally capped payouts at 200%.

If the Company’s absolute TSR over the two-year performance period is negative, the payout is capped at target irrespective of the Company’s performance relative to the comparator group.

If the Company’s TSR over the two-year performance period is below the 50th percentile of the comparator group, the payout is capped at target irrespective of how well the Company performs with respect to 2022 revenues.
Long-Term Retention Incentive (time-based RSUs)

Continued service to the Company and its shareholders
Purpose:

Create alignment with shareholders by focusing efforts on longer-term financial and shareholder returns; Management retention.
Decisions for 2021:

Time-based RSUs represent 50% of an NEO’s target award.
Health and welfare benefits

Provide appropriate amount of safety and security for executives and their families (as applicable) in the form of medical coverage as well as death/disability benefits
Purpose:

Allow executives to focus their efforts on running the business effectively.
Decisions for 2021:

No changes from 2020.
Base Salary
The Compensation Committee reviews our executive officers’ base salaries annually at the end of the year and establishes the base salaries for the upcoming year. Base salary for our executive officers is determined after consideration of numerous factors, including, but not limited to: scope of work, skills, experience, responsibilities, performance and seniority of the executive, peer group salaries for similarly-situated positions (i.e., a market competitive review) and the recommendation of the Chief Executive Officer
 
25

 
(except in the case of her own compensation). Ms. Cochran’s salary is set in accordance with her employment agreement (discussed in greater detail below), subject to increases at the discretion of the Compensation Committee. The Company views base salary as a fixed component of executive compensation that compensates the executive officer for the daily responsibilities assumed in operating the Company throughout the year.
In light of the pandemic, none of our NEOs other than Mr. Hackney received an increase in base salary in 2021. Mr. Hackney’s base salary was increased because he was promoted to Senior Vice President of Restaurant and Retail Operations in the third quarter of 2019 and his base salary was significantly below market median at the outset of 2021.
Base salaries for 2020 and 2021 for the Named Executive Officers, rounded to the nearest thousand dollars, were as follows:
NAMED EXECUTIVE OFFICER
2020
BASE SALARY
2021
BASE SALARY
PERCENT
CHANGE
Sandra B. Cochran
$ 1,150,000 $ 1,150,000 0%
P. Douglas Couvillion
$ 370,000 $ 370,000 0%
Jennifer L. Tate*
N/A $ 400,000
N/A
Richard M. Wolfson
$ 450,000 $ 450,000 0%
Michael T. Hackney
$ 375,000 $ 425,000 13.3%
Jill M. Golder*
$ 545,000 $ 545,000 0%
*
Ms. Tate joined the Company in 2021. Ms. Golder retired from the Company on December 31, 2020.
Annual Bonus Plan
Our annual bonus plan is designed to provide our executive officers with the opportunity to receive additional cash compensation based on a target percentage of base salary, but only if the Company successfully meets established performance targets. The annual bonus plan or a variant thereof applies to hundreds of our management-level employees and not just our executive officers.
Because of the pandemic and its impact on the Company, no NEO received an increase in their respective target bonus opportunity in 2021; rather, all 2021 target bonus percentages for our NEOs remained at their 2020 levels.
Program Design for 2021
Background
Prior to the pandemic, the Company traditionally used operating income as the sole performance metric under the annual bonus plan. Because of the highly uncertain and volatile sales and regulatory environment caused by the pandemic in 2021, however, the Compensation Committee determined that although operating income should remain a part of the annual bonus plan in 2021, the range of potential outcomes for this metric was too broad and would not necessarily be indicative of management’s performance. As a result, the Compensation Committee determined that while operating income should play a part in the 2021 bonus plan, other metrics were more appropriate and more meaningful to the short and long-term success of the Company. The Company anticipates reverting to operating income as the primary, if not necessarily the sole, performance metric for the annual bonus plan once the pandemic subsides and the Company’s sales and operational environment normalizes.
Program Design
In designing the 2021 annual bonus plan, the Compensation Committee decided that it was important to incentivize management to achieve the following two goals, which the Compensation Committee viewed as being in the best interest of the Company and our shareholders:
 
26

 

First, ensure that the Company was able to successfully navigate the pandemic throughout 2021, by preserving liquidity, taking care of employees, ensuring guest satisfaction, protecting the Company’s brands, and complying with health and safety requirements.

Second, position the Company to achieve long-term success through the Company’s longer-term strategic initiatives and its announced sustainable cost-savings efforts.
In designing the annual bonus program for 2021, the Compensation Committee also believed it was important, and in our shareholders’ best interest, to follow certain guiding principles:

The program should use quantitative rather than subjective metrics to assess performance and limit the need for Committee discretion where possible.

Irrespective of how well the Company performs against its quantitative metrics, the program should not allow for bonus payouts if the Company fails to achieve a sufficient degree of profitability. Additionally, no payouts should be earned above target unless the Company meaningfully beats both its budgeted and prior year’s profit performance.

In no event should payouts exceed 125% of target, despite the Company’s normal practice of capping bonus payments at 200% of target.
Bearing these goals and parameters in mind, the Compensation Committee structured the 2021 annual bonus program as a two-stage program, whereby management would need to achieve a series of weighted objective performance metrics in the first stage, and then final payouts would be adjusted in the second stage based on the Company’s achievement of operating income, with such payouts ranging from 0% to a maximum 125% of target.
These two stages and the applicable metrics are described in the following narrative and charts:
First Stage — Operational and Strategic Metrics
In the first stage of the annual bonus plan, the Compensation Committee established a weighted scorecard of objective performance metrics, with preset and discrete goals for each metric. These metrics were equally weighted between various shorter-term “operational” metrics (i.e., to ensure the Company successfully navigated the pandemic) and longer-term “strategic” metrics (i.e., to position the Company for longer-term success) by assigning a number of possible points to each metric. Metrics were designed to be “all or nothing,” such that failure to satisfy a metric would result in zero points and the achievement of a metric would result in the full amount of points being awarded. The total number of possible points was 120.
The Committee then created a payout grid based on the total number of points achieved, capping the associated payouts at target:
Total Points
Percent of Target Payout
Below 50
0
50-64
25% of Target
65-74
50% of Target
75-79
75% of Target
80-85
85% of Target
86-120
100% of Target
The first stage metrics are discussed below, and all of them were objective and determined by the Compensation Committee to be appropriately meaningful and challenging to accomplish. Additionally, the Company’s achievement of these metrics was designed to be auditable (and was in fact audited) by the Company’s internal auditing group following a predetermined methodology, following the conclusion of 2021. There was no subjectivity as to whether a metric was achieved.
 
27

 
Operational Metrics
As noted above, fifty percent of the possible score in the first stage was based on management’s achievement of shorter-term “operational metrics” in areas of employee and guest satisfaction, liquidity/cash management, restaurant and retail performance, and health & safety. The Compensation Committee determined that these subject areas were the most important to ensure the Company was able to protect its brands and its human and financial resources in 2021.
In determining the specific performance metrics to be achieved in each of these areas, the Compensation Committee selected metrics that the Compensation Committee judged were important and for which management should be held accountable even during the pandemic. Each operational metric had its own assigned point value and had an objective quantifiable target that the Committee determined was appropriately challenging to accomplish. They included the following discrete metrics:
Operational Area
Specific Scorecard Metric
Finance

Targeted levels of liquidity and cash

Credit Agreement covenant compliance
Human Capital Management

Store hourly and store management turnover levels
Guest Experience

“Lost Guest” metrics

Guest Experience metrics
Restaurant and Retail Performance

Retail margins

Restaurant Cost of Goods Sold

Restaurant labor expense

Key holiday sales levels
Health and Safety

OSHA violations and health/safety related store closures
This scorecard applied to hundreds of employees who participated in the bonus plan and not only to our executive officers.
Strategic Metrics
As noted above, the other fifty percent of the possible score in the first stage was based on management’s achievement of certain “strategic metrics” tied to various longer-term strategic initiatives, including our technology/digital projects, beverage/beer and wine program, comprehensive new menu rollout, and pursuit of sustainable cost savings. These are the initiatives that have been widely discussed with our shareholders and the investment community, that were approved by our Board to create long-term value for our shareholders prior to 2021, and, consequently, that the Compensation Committee believed to be the most appropriate for measuring performance in 2021. As with the operational metrics, the strategic metrics were discrete, objective, quantifiable, and challenging and the scorecard applied to the majority of the hundreds of employees who participated in the bonus plan and not only to our executive officers.
Strategic Initiative
Specific Scorecard Metric
Beer/Wine Initiative

Beer/Wine store launches around the country

Beer/Wine daily sales
IT Systems

Rollout of new POS system
New Dinner Menu Initiative

Launch final phase of new dinner menu in all approved stores
Digital Store

Digital store launch and sales levels from all channels
 
28

 
Strategic Initiative
Specific Scorecard Metric
Off-Premises Sales

Sales achieved through various off-premises sales channels
Maple Street Biscuit Company

Store-level EBITDA
Cost Savings

Cumulative cost savings against Company’s publicly stated goals
First Stage Results
Each of the operational and strategic metrics identified above was assigned a pre-determined “all or nothing” point value, with a maximum aggregate of 120 possible points. Following the conclusion of 2021, based on a report from the Company’s internal auditors following the agreed objective calculation methodologies, the Compensation Committee certified that the Company achieved 112.5 points out of the possible 120 points. Based on these results, management earned 100% of target under the payout chart applicable to the first stage of the annual bonus program.
Second Stage — Adjustment based on Operating Income
In addition to the importance the Compensation Committee placed on operational performance against objective scorecard metrics, the Compensation Committee also sought to ensure that bonus payouts would only be made to the extent that the Company was sufficiently profitable to make them and to ensure that above-target bonuses would be paid only for superior financial performance against both the Company’s plan and against prior year. The Committee therefore established a profitability framework whereby the Company’s first stage scorecard result was subject to a quantitative adjustment factor based on the Company’s achievement of operating income in 2021. This adjustment factor could cause final payouts to range between 0% and a maximum of 125% of target.
The following chart sets forth the targeted levels of operating income and the resulting impact on bonus payouts.
Classification
Operating Income Range
Impact on Bonus
Unacceptable Financial Performance Below $30 million No bonus paid, irrespective of first stage results
Below Anticipated Financial Performance Between $30 and $70 million Bonus payout earned under first stage reduced by 25%
Anticipated Financial Performance Between $70 and $145 million Bonus payout as earned under first stage (i.e., no adjustment, max payout at target)
Superior Financial Performance Over $145 million Bonus payout earned under first stage increased by 25% (i.e., max payout of 125% of target)
In establishing the foregoing levels, the Compensation Committee took into account the significant and continued uncertainty caused by the pandemic, but still required the Company to earn more than double its 2020 operating income of $68.9 million to achieve an above-target payout.
Second Stage/Final Results
Following the conclusion of 2021, based on the Company’s audited financial results, the Compensation Committee certified that the Company earned $166.8 million of operating income in 2021. This amount was more than 2.4 times the Company’s operating income in 2020 and significantly in excess of the expectations reflected in the 2021 plan approved by the Board prior to the start of the fiscal year. This resulted in each of the NEOs (and hundreds of other employees whose annual bonus is subject to the same program and/or calculations) receiving their respective bonus at 125% of target in 2021.
 
29

 
The following table sets forth (i) target 2021 bonuses for the Named Executive Officers, expressed both as a percentage of base salary and in absolute amounts, and (ii) the actual bonuses received by the Named Executive Officers under the 2021 annual bonus plan:
NAMED
EXECUTIVE
OFFICER
2021 BASE
SALARY
2021 BONUS
TARGET
PERCENTAGE
2021 BONUS
TARGET
MULTIPLIER APPLIED
TO TARGET
2021 ACTUAL
BONUS
Sandra B. Cochran
$ 1,150,000 125% $ 1,437,500 125% $ 1,796,875
P. Douglas Couvillion
$ 370,000 65% $ 240,500 125% $ 300,625
Jennifer L. Tate(1)
$ 368,000 55% $ 202,500 125% $ 253,125
Richard M. Wolfson
$ 450,000 65% $ 292,500 125% $ 365,625
Michael T. Hackney
$ 425,000 65% $ 276,250 125% $ 345,312
Jill M. Golder(2)
$ 545,000 75% $ 408,750 0% $ 0
(1)
Ms. Tate joined the Company after the start of our fiscal year and the amount indicated as her base salary for purposes of bonus calculation represents her base salary prorated to her dates of service.
(2)
Ms. Golder retired from the Company on December 31, 2020 and was ineligible to receive her annual bonus for 2021.
The above 2021 annual bonuses are reflected in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table on page 41 of this proxy statement.
Long-Term Incentives
The Compensation Committee believes that long-term incentives, particularly equity-based awards, provide a strong alignment of the interests of shareholders and executives and serve as a valuable talent retention tool. Therefore, a significant portion of our executive officers’ total compensation is provided in the form of equity awards, which are granted under the Company’s 2020 Omnibus Incentive Plan and, prior to November 2021, the Company’s 2010 Omnibus Stock and Incentive Plan, approved by our shareholders (either the “2010 Omnibus Plan” or “2020 Omnibus Plan”, as applicable). Each year the Compensation Committee considers and discusses various alternatives as to the form and structure of equity-based awards in order to best achieve these goals of shareholder alignment and talent retention.
Long-Term Incentive Arrangements for 2021
In 2021, the Company’s equity compensation to executive officers was governed by the 2021 Long-Term Incentive (“LTI”) program. The 2021 LTI program, which the Compensation Committee adopted in September 2020, consists of two components: (i) a Long-Term Performance Plan (LTPP) (the “2021 LTPP”), which represents 50% of the LTI target value at the time of grant and provides for awards of performance shares tied to the Company’s successful achievement of a relative total shareholder return (TSR) goal over 2021 and 2022 against a peer set of restaurant companies; and (ii) a time-based RSU Award (the “2021 RSU Award”), which represents the remaining 50% of the LTI target value at the time of grant and provides for awards of time-based RSUs that cliff-vest after three years from the date of grant, subject to an executive’s continued employment with the Company through the vesting date.
Changes from Prior Years
The 2021 LTI program varies from the LTI programs used in prior years in two ways. First, the Compensation Committee determined to use a relative TSR metric coupled with a 2022 sales metric to measure performance under the LTPP rather than using return on invested capital (ROIC), which is the metric that the Company has traditionally used. The Compensation Committee made this change due to the continued challenging business conditions and volatility brought about by the outsized impact of the pandemic on both the Company and the restaurant industry in 2021, which the Compensation Committee believed would make ROIC an insufficiently predictable performance metric to be effective.
Second, the Compensation Committee eliminated a time-based RSU grant with a fractional TSR modifier that previously represented 25% of the value of an executive’s LTI award and replaced it with
 
30

 
additional time-based RSU Awards such that the target value of the 2021 RSU Awards went from 25% to 50% of an executive’s LTI award. This change reflected the Compensation Committee’s determination that a 50/50 split between pure performance-based and time-based equity awards was more easily understood by plan participants, more in line with market practice in the Company’s industry and more balanced between the goals of linking pay to performance and providing for executive retention. As indicated above, the shareholders with whom we engaged during our 2021 shareholder outreach efforts agreed with this determination.
2021 LTPP
The Compensation Committee determined that assessing (i) performance relative to a peer set in the restaurant industry and (ii) Company 2022 sales levels vs. 2019 (pre-pandemic) would be the best way to measure and link executive pay to performance for purposes of the 2021 LTPP. The Compensation Committee therefore established the 2021 LTPP as follows.
Performance Measurements:

Relative TSR measured against 23 restaurant companies drawn from relevant indices and/or peer sets, using 30-day average price straddle at the beginning and end of performance period to avoid date-based anomalies.

2022 vs. 2019 gross sales.
Measurement Period:

2 years (2021 and 2022)
Potential Award Range:

0 – 150% of target (down from 200% traditionally)
Other Features:

Negative absolute TSR will result in payouts being capped at target irrespective of how the Company performs relative to the comparator group.

If the Company has TSR below the 50th percentile of the comparator group, payout will be capped at target no matter how well the Company performs with respect to the sales component of the program.
Establishment of Comparator Group for TSR Calculation
In selecting the comparator group for assessing TSR over the performance period, the Compensation Committee noted that Cracker Barrel is unique in the restaurant industry, and, consequently, the comparator set should represent a cross-section of restaurant companies, each of which shares one or more attributes with the Company.
Additionally, the Compensation Committee believed the comparator group should be limited to restaurant companies as opposed to a broader industry mix because of the outsized impact that the pandemic had, and is expected to continue to have, on the restaurant industry in particular. The Committee also determined that the group should include only mid-cap and small-cap companies in the group, as large-cap and micro-cap companies are too different from the Company in terms of their resources and business challenges to fairly compare them to the Company, particularly during the pandemic.
Based on this, the Compensation Committee selected the following comparator group of 23 public restaurant companies.

Brinker International, Inc.

Dave & Busters

Pollo Loco

BJ’s Restaurants, Inc.

Denny’s Corporation

Red Robin Gourmet Burgers, Inc.
 
31

 

Bloomin’ Brands, Inc.

Dine Brands Global, Inc.

Ruth’s Hospitality Group, Inc.

Cannae Holdings Inc.

Domino’s Pizza, Inc.

Shake Shack Inc.

Cheesecake Factory, Inc.

Fiesta Restaurant Group, Inc.

Texas Roadhouse, Inc.

Chipotle Mexican Grill, Inc.

Jack-in-the-Box, Inc.

The Wendy’s Company

Chuy’s Holdings Inc.

Noodles & Company

Wingstop Inc.

Darden Restaurants, Inc.

Papa John’s International, Inc.
Potential Payouts
Historically, the Company’s payout curve for LTPP awards of performance-based shares has been set at a range from 0% to 200% of target. For 2021, however, payouts were capped at 150% of target, and in no event can payments exceed target if the Company’s absolute TSR over the performance period is negative, irrespective of how well the Company performs with respect to the comparator group or its levels of 2022 sales. Similarly, in no event can payments exceed target if the Company’s TSR over the performance period is below the 50th percentile of the comparator group, irrespective of how well the Company performs with respect to its levels of 2022 sales. The Compensation Committee believed all of these limitations to be appropriate in light of the financial impact of the pandemic on the Company’s business and to better align the program with the interests of shareholders.
2021 LTI Award Grants
In September 2020, the Compensation Committee (and the Board, in the case of Ms. Cochran) approved equity grants based on a target percentage (referred to as the executive officer’s “LTI Percentage”) of an executive officer’s base salary divided equally between performance-based LTPP awards and time-based RSU awards. Because of the economic impact of the pandemic, the Compensation Committee determined that it would be inappropriate to increase any NEO’s LTI Percentage from their 2020 levels.
Each NEO’s LTI Percentage was then used to derive a target award for the NEO, expressed as a number of shares, determined by reference to the average closing price of the Company’s common stock during the last 30 calendar days of 2020 and the first 30 calendar days of 2021, which was $112.35. Each NEO’s targeted shares were divided equally between grants of performance-based LTPP awards and time-based RSU awards.
All awards granted under the LTI program are credited with dividend equivalent rights for any cash dividends paid on the Company’s stock between the award date and the vesting date, based on the number of shares ultimately awarded, and the deferred amounts are settled in cash upon the vesting of the awards at the end of the performance period. No dividends are paid on unvested/unearned shares.
2021 LTPP.   For 2021, each executive officer was eligible to receive a 2021 LTPP award (a “2021 LTPP Award”) of a target number of shares, with the actual number of awarded shares determined by the Company’s achievement of relative TSR against a peer group of companies in the restaurant sector, measured over a two-year performance period, as described above. The minimum number of shares is zero and the maximum is 150% of target. NEOs (other than Ms. Cochran) will forfeit their 2021 LTPP Award if, prior to that time, they are terminated or voluntarily resign other than as a result of (i) retirement by an individual who meets the retirement-eligible conditions of 60 years of age and at least five years of service, for which such awards will be prorated for time served and based on actual performance determined at the end of the performance period; or (ii) following a change in control of the Company.
The following table summarizes the target 2021 LTPP Awards for each of our Named Executive Officers at the time of grant. As indicated above, the awards will pay out, if at all, at the end of the performance period in September 2022:
NAMED EXECUTIVE OFFICER
LTPP PERCENTAGE
BASE SALARY
LTPP TARGET VALUE
LTPP TARGET
AWARD (# Shares)
Sandra B. Cochran
190.0% $ 1,150,000 $ 2,185,000 19,448
P. Douglas Couvillion
37.5% $ 370,000 $ 138,750 1,234
 
32

 
NAMED EXECUTIVE OFFICER
LTPP PERCENTAGE
BASE SALARY
LTPP TARGET VALUE
LTPP TARGET
AWARD (# Shares)
Jennifer L. Tate
50.0% $ 400,000 $ 200,000 1,780
Richard M. Wolfson
60.0% $ 450,000 $ 270,000 2,403
Michael T. Hackney
37.5% $ 425,000 $ 159,375 1,418
Jill M. Golder*
75.0% $ 545,000 $ 408,750 3,638
*
Ms. Golder retired from the Company on December 31, 2020, and these awards were forfeited.
2021 RSU Awards.   Each executive officer received a target 2021 RSU Award that will cliff-vest three years from the date of grant. NEOs (other than Ms. Cochran) will forfeit their 2021 RSU Award if, prior to that time, they are terminated or voluntarily resign other than as a result of (i) retirement by an individual who meets the retirement-eligible conditions of 60 years of age and at least five years of service, for which such awards will be prorated for time served and based on actual performance determined at the end of the performance period; or (ii) following a change in control of the Company.
The following table summarizes the 2021 RSU Awards for each of our Named Executive Officers:
NAMED EXECUTIVE OFFICER
RSU PERCENTAGE
BASE SALARY
TARGET VALUE
NO. OF
RSUS GRANTED
Sandra B. Cochran
190.0% $ 1,150,000 $ 2,185,000 19,488
P. Douglas Couvillion
37.5% $ 370,000 $ 138,750 1,234
Jennifer L. Tate
50.0% $ 400,000 $ 200,000 1,780
Richard M. Wolfson
60.0% $ 450,000 $ 270,000 2,403
Michael T. Hackney
37.5% $ 425,000 $ 159,375 1,418
Jill M. Golder*
75% $ 545,000 $ 408,750 3,638
*
Ms. Golder retired from the Company on December 31, 2020, and these awards were forfeited.
Health and Welfare Benefits
We offer a group insurance program consisting of life, disability and health insurance benefit plans that cover all full-time management and administrative employees, and a supplemental group term life insurance program that covers our Named Executive Officers and certain other management personnel. Aside from the annual recalibration of benefit costs and the associated premium changes that affect all participants, no significant changes were made to our health and welfare benefits for our Named Executive Officers during 2021.
Severance and Change in Control Provisions
None of our current Named Executive Officers has an employment agreement other than Ms. Cochran, which governs her arrangement relating to severance and/or a change in control of the Company (a “CIC Transaction”). All of our other Named Executive Officers, along with all of the Company’s other executive officers, have entered into (i) severance agreements (“Severance Agreements”) that govern the terms of their involuntary separation from the Company other than in connection with a CIC Transaction; and (ii) change in control agreements (“CIC Agreements”) that govern their employment by the Company and the terms of their involuntary separation from the Company following a CIC Transaction. These agreements, which are summarized as they apply to our Named Executive Officers below, were not amended in 2021.
The Severance Agreements are intended to attract and retain executive talent by providing executives with reasonable assurance that if their employment relationship with the Company is involuntarily terminated in certain circumstances other than for cause they will have sufficient resources to be able to transition to other professional opportunities. While the CIC Agreements are also intended as a recruitment and retention tool, they are additionally intended to ensure that the Company will have the continued
 
33

 
dedication, focus and objectivity from key executives in the event of a proposed CIC Transaction, and thus maintain the alignment of our executives’ interests with those of our shareholders.
The Employment Agreement, Severance Agreement and CIC Agreements are described in greater detail below. Potential payments pursuant to these agreements to our Named Executive Officers under various termination scenarios are more fully described under “Executive Compensation — Compensation Tables and Information — Potential Payments Upon Termination or Change in Control” below, including the table on page 49 of this proxy statement.
Severance Benefits Specific to Ms. Cochran
The Company and Ms. Cochran are parties to an employment agreement (the “Employment Agreement”) entered into on July 27, 2018, which governs the severance benefits to be received by Ms. Cochran. Under the Employment Agreement, Ms. Cochran’s employment with the Company is “at will” and either party may terminate the agreement at any time, but Ms. Cochran will be entitled to certain severance benefits in the event that her employment with the Company is terminated under certain circumstances. If Ms. Cochran’s employment is terminated by the Company without cause (as defined in the agreement) or terminated by Ms. Cochran with good reason (as defined in the agreement) prior to July 27, 2023 and outside of a CIC Transaction, Ms. Cochran will be entitled to receive (i) a lump sum payment of accrued obligations, including, among other things, her base salary through the date of termination and reimbursement for any business expenses to the extent not previously paid (“accrued obligations”), (ii) two times the sum of (x) her then-current annual base salary and (y) then-current target bonus payable in installments ratably over 24 months following termination, (iii) a lump sum payment equal to her annual bonus for the fiscal year in which the termination occurs, prorated based on the number of days elapsed between the beginning of the fiscal year and the termination date, to the extent the applicable performance goal is subsequently achieved, and (iv) a lump sum amount equal to 24 times the monthly COBRA premium amount applicable as of the termination date. Additionally, the Employment Agreement provides for acceleration of vesting of long-term incentive awards held by Ms. Cochran at the time of termination without cause or with good reason within the first five years following the execution of the agreement (i.e., until July 27, 2023). Specifically, Ms. Cochran’s outstanding long-term incentive awards that vest with the passage of time (“time-based awards”) will accelerate and vest in full upon termination, and her long-term incentive awards that vest depending upon the Company’s performance (“performance-based awards”) will vest in full, but only when and to the extent the applicable performance goals are subsequently achieved.
If Ms. Cochran’s employment is terminated without cause or for good reason after July 27, 2023, then in lieu of the benefits summarized above she will be entitled to receive only (i) the accrued obligations and (ii) 1.50 times the sum of (x) current annual base salary and (y) target current year bonus payable in installments, with no payment of a prorated target bonus for the termination year, no vesting of unvested long-term incentive awards, and no payment for health and welfare benefits continuation.
The payment of the foregoing severance benefits, exclusive of the accrued obligations, is subject to execution by Ms. Cochran of a comprehensive release of claims against the Company. If Ms. Cochran’s employment is terminated by the Company for cause or if Ms. Cochran terminates her employment by voluntarily quitting without good reason, then she would be entitled to receive only the accrued obligations.
If Ms. Cochran retires after providing to the Company at least 12 months’ advance of her intent to retire, Ms. Cochran’s outstanding time-based awards will vest in full in accordance with the original vesting schedule set forth in the applicable award agreements and her performance-based awards will vest in full to the extent the applicable performance goals are subsequently achieved, all as if she had remained employed by the Company following her retirement throughout the applicable vesting periods. In other words, no award would accelerate upon retirement and all performance-based awards remain subject to the Company’s achievement of all applicable performance criteria.
Severance Agreement for all other Named Executive Officers
Each Named Executive Officer who is a party to the Severance Agreement will be entitled to receive severance benefits of 12-18 months’ base salary continuation and continuation of benefits under COBRA (with the executive responsible for paying the premiums), depending on his/her length of service, as a result
 
34

 
of the termination of his/her employment by the Company other than for “cause” or by the executive for “good reason” ​(each as defined in the agreement).
To receive the foregoing benefits, the executive must execute a comprehensive release in favor of the Company, waiving any claims the executive may have against the Company. In addition to obligating the executive to maintain confidentiality of Company information and return all Company property, the Severance Agreement further obligates the executive (i) not to work as an employee or consultant for any “multi-unit restaurant business that offers full service family or casual dining” for a period of six months following the severance event or the remainder of the severance payment period, whichever is shorter; and (ii) not to solicit the employees or customers of the Company for a period of 12 months following the severance event or the remainder of the severance payment period, whichever is shorter.
The Severance Agreement has an initial term of three years and will automatically renew each year thereafter unless the Company provides the executive with 90 days’ written notice of its intention not to renew prior to the expiration of the then-current term.
Change in Control Benefits for Ms. Cochran
Ms. Cochran’s Employment Agreement contains certain benefits in the event that her employment with the Company is terminated in connection with a change in control. The Employment Agreement contains a “double trigger,” and in the event that a change in control of the Company (as defined in the agreement) occurs during the term of the Employment Agreement, and her employment is terminated without cause or terminated by Ms. Cochran with good reason within 90 days prior to or within two years following the change in control, Ms. Cochran will be entitled to receive (i) a lump sum payment of accrued obligations, (ii) a lump sum payment of three times the sum of (x) current annual base salary and (y) target current year bonus, (iii) a lump sum payment equal to her target bonus for the fiscal year in which the termination occurs, prorated based on the number of days elapsed between the beginning of the period and the termination date, (iv) acceleration and immediate vesting of all long-term incentive awards, with time-based awards vesting in full and performance-based awards vesting at target level, and (v) a lump sum amount equal to 24 times the monthly COBRA premium amount applicable as of the termination date.
The Employment Agreement does not entitle Ms. Cochran to receive any gross-up payment to reimburse her for any excise tax under Sections 280G and 4999 of the Code, as amended. Ms. Cochran will be subject to noncompetition, non-solicitation and confidentiality restrictions following the termination of her employment. The agreement obligates Ms. Cochran not to own or work as an employee or consultant for any multi-unit restaurant business that offers full service family or casual dining or to solicit the Company’s employees for a period of two years following the termination of her employment.
CIC Agreements
The CIC Agreement becomes effective only in the event of a CIC Transaction, as defined in the agreement. Once it takes effect, the Company agrees to employ the executive, and the executive agrees to remain in the employ of the Company, from the date of a change in control to the earlier to occur of the second anniversary of such change in control or the executive’s normal retirement date. During this period of employment, the Company agrees to provide the executive with (i) base salary at least equal to the highest base salary which the executive was paid during the 24 calendar months immediately prior to the change in control, (ii) the right to participate, at the highest target percentage rate or target participation level at which he/she participated during the 12-month period prior to the change in control, in the Company’s bonus and equity incentive compensation plans; and (iii) the same employee benefits and perquisites which the executive received (or had the right to receive) during the 12 months immediately prior to the date of the change in control.
The CIC Agreement has an indefinite term but may be terminated by the Company upon not less than one year’s prior written notice to the executive if (i) the Company has not received any proposal or indication of interest from a party regarding, nor is the Company’s Board of Directors then considering, a potential change in control transaction; and (ii) the Company terminates the CIC Agreements for all similarly situated executives and not just the individual.
 
35

 
The CIC Agreement is “double trigger”, and no payments or equity awards are paid out immediately upon the change in control. The executive does not have any right to receive any gross-up payment in reimbursement of any excise tax under Sections 280G and 4999 of the Internal Revenue Code of 1986, as amended (the “Code”). If amounts payable under the CIC Agreement would be subject to such excise tax, then the executive will pay the tax or such amounts will be reduced to a level where the excise tax no longer applies, whichever is more beneficial to the executive.
In the event that employment is terminated by the Company other than for “cause” or by the executive for “good reason” ​(each as defined in the agreement) at any point during the 24 months following a change in control, then, in addition to any accrued and unpaid salary, bonus, benefits and vacation time, the terminated executive is entitled to (i) a lump-sum cash payment equal to two times the sum of his/her annual salary and target annual bonus for the year in which termination occurs, (ii) his/her annual bonus for the year in which termination occurs, pro-rated to his/her actual period of service during that year; (iii) continued health and welfare benefits and perquisites for the two-year period following termination at no greater cost to the executive; and (iv) the payment of the cash-out of his/her equity awards, as described below.
Unless an individual equity award agreement provides the executive with immediate vesting of the award upon a change in control (in which case the terms of such award agreement will apply), under the CIC Agreement, all of the executive’s outstanding and unvested equity awards and accrued dividends at the time of the change in control occurs will be converted to cash at their target level of award, which, depending on the Company’s projected performance at the time of conversion, could be beneficial or detrimental to the executive. The converted cash will earn interest at the rate of 1.5% over the 10-year Treasury Bill rate in effect at the beginning of each month and will be paid to the executive upon the earliest to occur of (i) the second anniversary of the change in control; (ii) the date(s) on which the underlying awards would have otherwise vested or been paid; or (iii) the date of a qualifying termination of the executive’s employment under the CIC Agreement.
Perquisites
Other than participation in benefit plans that are broadly applicable to our full-time employees, we provide very limited perquisites and other benefits to our Named Executive Officers. Indeed, we only provide to our executive officers a modest financial planning assistance benefit and executive physicals, both of which we also offer to several non-executive officers.
All perquisites that are received by Named Executive Officers are reflected in the Summary Compensation Table on pages 41 – 43 of this proxy statement under the “All Other Compensation” column and related footnote.
As far as other perquisites are concerned, we note that:

Named Executive Officers do not have use of a Company vehicle;

Named Executive Officers may not schedule the Company aircraft for personal travel;

We do not have a defined benefit pension plan or SERP; and

We do not provide a number of perquisites that are provided by other companies, such as club memberships or drivers.
Section 5.   Realizable Pay Analysis and Other Executive Compensation Policies and Guidelines
Realizable Pay Analysis
While many of the required compensation disclosures under SEC rules represent awards that may be earned, realizable pay considers pay that is actually earned. The following chart demonstrates, over the three-year period of 2019, 2020 and 2021, that the Company’s Total Shareholder Return increased modestly by 1%, but Ms. Cochran’s realizable total direct compensation declined by 6% from her target total direct compensation for that same period.
 
36

 
[MISSING IMAGE: m2127874d1-bc_cbrltsrbw.jpg]
In the chart above, Ms. Cochran’s “Target Pay” reflects the following:

Ms. Cochran’s aggregate base salary for 2019, 2020 and 2021, as approved by the Board at the outset of each such year

Ms. Cochran’s aggregate target bonus opportunity for performance under the Company’s annual bonus plan in each of 2019, 2020 and 2021, as approved by the Board at the outset of each such year

The grant date fair value of the target levels of 2020 and 2021 LTPP Awards granted to Ms. Cochran at the outset of 2020 and 2021, based on the closing stock price on the respective grant dates of such awards

The grant date fair value of all other time-based and performance-based equity awards (other than LTPP awards) granted to Ms. Cochran at the outset of 2019, 2020 and 2021, based on the closing stock price on the respective grant dates of such awards.
In contrast, Ms. Cochran’s “Realizable Pay” in the above chart reflects the following:

Ms. Cochran’s actual base salary for 2019, 2020 and 2021

Ms. Cochran’s actual bonus paid in respect of performance in each of 2019, 2020 and 2021 under the Company’s annual bonus plans for such years
 
37

 

The fair value of the 2020 and 2021 LTPP Awards granted to Ms. Cochran, based on the closing stock price on the last day of 2021 of $136.18

The fair value of all other 2019, 2020 and 2021 time-based and performance-based equity awards (other than LTPP awards) granted to Ms. Cochran, based on the closing stock price on the last day of 2021 of $136.18.
Stock Ownership Guidelines
We have stock ownership guidelines (the “Ownership Guidelines”) that apply to all executive officers and our non-employee directors, and that are posted on our website at www.crackerbarrel.com. The Ownership Guidelines reflect the Compensation Committee’s belief that executives and directors should accumulate a meaningful level of ownership in Company stock to align their interests with shareholders. The Ownership Guidelines are based on a multiple of base salary for executive officers and the base annual cash retainer for non-employee directors. The Chief Executive Officer’s guideline is five times base salary, the Chief Financial Officer’s guideline is three times base salary and any other executive officer’s guideline is two times base salary. No officer may sell or otherwise dispose of any shares until his or her aggregate ownership satisfies these requirements. Our non-employee directors are subject to a guideline of six times the annual base cash retainer paid to such non-employee director. Calculations to determine compliance with the Ownership Guidelines are made during the first quarter of each year, and are based upon (i) with respect to executive officers, each officer’s base salary applicable at the time of such calculation and (ii) the average closing price of the Company’s common stock, as reported by Nasdaq, for each trading day during the last 30 calendar days of the preceding year and the first 30 calendar days of the year in which the calculation is performed. For 2021, the Ownership Guidelines for our Named Executive Officers were as follows:
Executive Officer
Multiple of
Base Salary
Sandra B. Cochran
5X
P. Douglas Couvillion(1)
2X
Jennifer L. Tate
2X
Richard M. Wolfson
2X
Michael T. Hackney
2X
Jill M. Golder(2)
3X
(1)
Mr. Couvillion was appointed to the Chief Financial Officer role on an interim basis.
(2)
Ms. Golder retired from the Company on December 31, 2020.
Executive officers and non-employee directors must retain 100% of the net number of shares of common stock acquired (after payment of exercise price, if any, and taxes) upon the exercise of stock options and the vesting of restricted stock or RSUs granted until they achieve compliance with the applicable guideline. Once achieved, ownership of the guideline amount must be maintained for as long as the executive officers and non-employee directors are subject to the Ownership Guidelines. Executive officers and non-employee directors who do not comply with the Ownership Guidelines may not be eligible for future equity awards. If an executive officer or non-employee director falls below the required ownership threshold, he or she is prohibited from selling shares of Company common stock until he or she meets the ownership thresholds.
Anti-Hedging and Anti-Pledging Policy
The Company’s anti-hedging and anti-pledging policy (the “Anti-Hedging and Anti-Pledging Policy”) prohibits directors and officers from directly or indirectly engaging in hedging against future declines in the market value of the Company’s securities through the purchase of financial instruments designed to offset such risk and from pledging the Company’s securities as collateral for margin and other loans. The Compensation Committee considers it improper and inappropriate for directors and officers of the Company to engage in hedging transactions to mitigate the impact of changes in the value of the Company’s securities.
 
38

 
Similarly, placing the Company’s securities in a margin account or pledging them as collateral may result in their being sold without the director’s or officer’s consent or at a time when the director or officer is in possession of material nonpublic information of the Company. When any of these types of transactions occurs, the director’s or officer’s incentives and objectives may be less closely aligned with those of the Company’s other shareholders, and the director’s or officer’s incentive to improve the Company’s performance may be (or may appear to be) compromised. Under the Anti-Hedging and Anti-Pledging Policy, no director or officer may, directly or indirectly, engage in any hedging transaction that reduces or limits the director’s or officer’s economic risk with respect to the director’s or officer’s holdings, ownership or interest in the Company’s securities, including outstanding stock options, stock appreciation rights or other compensation awards the value of which are derived from, referenced to or based on the value or market price of the Company’s securities.
Prohibited transactions include the purchase by a director or officer of financial instruments, including, without limitation, prepaid variable forward contracts, equity swaps, collars, puts, calls or other derivative securities that are designed to hedge or offset a change in market value of the Company’s securities, as well as any transaction that places the Company’s securities in a margin account or pledges them as collateral for loans or other obligations.
Recoupment Provisions
The Company may recover any incentive compensation awarded or paid pursuant to an incentive plan based on (i) achievement of financial results that were subsequently the subject of a restatement due to material noncompliance with any financial reporting requirement under either GAAP or the federal securities laws, other than as a result of changes to accounting rules and regulations, or (ii) a subsequent finding that the financial information or performance metrics used by the Compensation Committee to determine the amount of the incentive compensation were materially inaccurate, in each case regardless of individual fault. In addition, the Company may recover any incentive compensation awarded or paid pursuant to any incentive plan based on a participant’s conduct which is not in good faith and which materially disrupts, damages, impairs or interferes with the business of the Company and its affiliates.
Impact of Tax and Accounting Treatments on Compensation
Although the accounting and tax treatment of executive compensation generally has not been a factor in the Compensation Committee’s decisions regarding the amounts of compensation paid to our executive officers, it has been a factor in the compensation mix as well as the design of compensation programs. We have attempted to structure our compensation to maximize the tax benefits to the Company (e.g., deductibility for tax purposes) and to appropriately reward performance. The accounting treatment of differing forms of equity awards presently used to compensate our executives varies. However, the accounting treatment is not expected to have a material effect on the Compensation Committee’s selection of differing types of equity awards.
Sections 280G and 4999
As described above, Ms. Cochran has an Employment Agreement and we provide our Named Executive Officers other than Ms. Cochran with Severance and CIC Agreements. Neither Ms. Cochran nor any of our other Named Executive Officers has a right under these agreements or otherwise to receive any gross-up payment to reimburse such executive officer for any excise tax under Sections 280G and 4999 of the Code.
Section 162(m)
The Compensation Committee has historically considered the impact of Section 162(m) of the Code in the design of its compensation strategies. Under Section 162(m) of the Code, compensation paid to executive officers in excess of $1.0 million in any year cannot be taken by us as a tax deduction unless the compensation constitutes “qualified performance-based compensation” within the meaning of Section 162(m). The Compensation Committee and the Company designed our compensation structure in an attempt to maximize deductibility of compensation under Section 162(m) to the extent practicable while maintaining a competitive, performance-based compensation program. However, the Compensation Committee and the Company also believe that they must (and do) reserve the right to award compensation
 
39

 
which they each deem to be in the best interests of the Company and our shareholders, but which may not be fully tax deductible under Section 162(m). Moreover, this exception allowing the full deductibility of “qualified performance-based compensation” does not apply to compensation paid after January 1, 2018 unless paid pursuant to a written binding contract that was in effect on November 2, 2017.
Retirement and Consulting Arrangement of Ms. Golder
Ms. Golder retired from her position as Senior Vice President and Chief Financial Officer of the Company effective December 31, 2020. Following her retirement, from January 1, 2021 through February 28, 2021, Ms. Golder provided consulting services to the Company as a non-employee consultant, including assisting the Company with the transition of Ms. Golder’s duties to Mr. Couvillion, her successor as the Company’s Interim Chief Financial Officer. During her consultancy, Ms. Golder received a consulting fee of $22,708 per month.
COMPENSATION COMMITTEE REPORT
The Compensation Committee has reviewed and discussed with management the CD&A included in this proxy statement. Based on its review and discussions of the CD&A with management, the Compensation Committee recommended to the Board of Directors that the CD&A be included in this proxy statement and incorporated by reference into our Annual Report on Form 10-K for 2021.
This report has been submitted by the members of the Compensation Committee:
Coleman H. Peterson, Chair
Thomas H. Barr
Meg Crofton
Gilbert Dávila
 
40

 
COMPENSATION TABLES AND INFORMATION
Summary Compensation Table
The following table sets forth information regarding the compensation for the Named Executive Officers during 2021, 2020 and 2019.
Name and Principal
Position
Year
Salary(1)
($)
Bonus(2)
($)
Restricted
Stock/RSU
Awards(3)
($)
Non-Equity
Incentive Plan
Compensation(4)
($)
All Other
Compensation(5)
($)
Total
($)
Sandra B. Cochran,
President and Chief
Executive Officer
2021
$ 1,150,000 $ 0 $ 4,481,208 $ 1,796,875 $ 152,969 $ 7,581,052
2020
$ 982,292 $ 0 $ 4,265,425 $ 718,750 $ 249,974 $ 6,216,441
2019
$ 1,100,000 $ 0 $ 4,118,860 $ 1,359,996 $ 406,079 $ 6,984,935
P. Douglas Couvillion,
Senior Vice President and
Interim Chief Financial Officer
2021
$ 370,000 $ 50,000 $ 284,338 $ 300,625 $ 29,240 $ 1,034,203
2020
$ 343,021 $ 0 $ 270,610 $ 120,250 $ 35,291 $ 769,172
2019
$ 350,000 $ 0 $ 241,314 $ 234,393 $ 44,995 $ 870,702
Jennifer L. Tate,(6)
Senior Vice President and
Chief Marketing Officer
2021
$ 368,182 $ 0 $ 811,278 $ 253,125 $ 177,985 $ 1,610,570
Richard M. Wolfson,
Senior Vice President,
General Counsel and Secretary
2021
$ 450,000 $ 0 $ 553,699 $ 365,625 $ 31,888 $ 1,401,212
2020
$ 417,188 $ 0 $ 526,793 $ 146,250 $ 55,331 $ 1,145,562
2019
$ 375,000 $ 0 $ 1,170,693 $ 251,136 $ 88,245 $ 1,885,074
Michael T. Hackney,(7)
Senior Vice President,
Restaurant and Retail Operations
2021
$ 425,000 $ 0 $ 326,736 $ 345,312 $ 15,745 $ 1,112,793
2020
$ 347,656 $ 0 $ 274,091 $ 121,875 $ 17,979 $ 761,601
Jill M. Golder,(8)
Senior Vice President and Chief Financial Officer
2021
$ 272,500 $ 0 $ 0 $ 0 $ 2,490 $ 274,990
2020
$ 505,260 $ 0 $ 797,902 $ 204,375 $ 37,923 $ 1,545,460
2019
$ 530,000 $ 0 $ 731,022 $ 409,544 $ 60,106 $ 1,730,672
(1)
Amounts in this column reflect the actual base salary earned by the NEO in 2021, 2020 and 2019, including any deferred amounts reported in the Non-Qualified Deferred Compensation Table. However, see the note below regarding Ms. Golder’s salary.
(2)
In this column, the amount for Mr. Couvillion represents a cash bonus paid to him in respect of his assumption of the role of Interim Chief Financial Officer upon Ms. Golder’s retirement referenced below.
(3)
The amounts disclosed in this column reflect the aggregate grant date fair value of awards for 2021, 2020 and 2019, calculated in accordance with the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC Topic 718”). Specifically, the amounts provided for 2021 reflect the aggregate grant date fair value of the Named Executive Officer’s (i) time-based award under the 2021 Time-based RSU and (ii) performance-based awards under the 2021 LTPP.
 
41

 
For the performance-based awards, the aggregate grant date fair value has been determined assuming the probable outcome of the performance condition on the date of the grant (i.e., the achievement of the target performance level). Assuming an outcome of performance conditions at the maximum level for the performance-based awards, the aggregate grant date fair value of all the stock awards made to each Named Executive Officer in 2021 (including the time-based award) are as follows:
Name
Year
Aggregate Grant Date Fair
Value at Maximum
Performance Level
Sandra B. Cochran
2021 $ 6,721,812
P. Douglas Couvillion
2021 $ 426,507
Jennifer L. Tate
2021 $ 960,851
Richard M. Wolfson
2021 $ 830,549
Michael T. Hackney
2021 $ 490,103
Jill M. Golder*
2021 $ 0
*
Ms. Golder retired from the Company on December 31, 2020, and her stock awards were forfeited.
For information regarding the compensation cost of the awards and the assumptions used to calculate the grant date fair value of the awards, see Note 10 to the Consolidated Financial Statements included or incorporated by reference in the Company’s Annual Reports on Form 10-K for 2021, 2020 and 2019.
(4)
Amounts in this column reflect the aggregate grant date fair value earned by the NEO in 2021, 2020 and 2019, including any deferred amounts reported in the Non-Qualified Deferred Compensation Table.
(5)
The table below sets forth information regarding each component of compensation included in the “All Other Compensation” column of the Summary Compensation Table above.
(6)
Ms. Tate became an executive officer of the Company on August 31, 2020. The amount included for Ms. Tate under the column entitled “Stock Awards” includes a one-time grant of 3,000 shares of restricted stock issued to Ms. Tate upon her joining the company. These shares will vest on August 31, 2023.
(7)
Mr. Hackney became an executive officer of the Company on May 1, 2019.
(8)
Ms. Golder retired from her position as Senior Vice President and Chief Financial Officer of the Company effective as of December 31, 2020 and thus forfeited all of the equity awards granted to her in respect of 2021. The amount shown for her 2021 base salary represents Ms. Golder’s pro-rated portion of her base salary based on the number of days in the fiscal year prior to her separation from service. Following her retirement, Ms. Golder also received $45,416 for consulting services provided as a non-employee consultant of the Company during 2021.
All Other Compensation
Name
Year
Life
Insurance(1)
Long-
term
Disability(1)
Dividend
Equivalents
on Shares
of
Restricted
Stock(2)
Company
Match Under
Non-qualified
Deferred
Compensation
Plan
Company
Match
Under
401(k)
Plan
Other(3)
Total
Sandra B. Cochran
2021 $ 19,560 $ 1,728 $ 99,326 $ 30,103 $ 2,252 $ 0 $ 152,969
P. Douglas Couvillion
2021 $ 217 $ 1,066 $ 6,224 $ 4,557 $ 2,176 $ 15,000 $ 29,240
Jennifer L. Tate
2021 $ 240 $ 0 $ 6,560 $ 0 $ 0 $ 171,185 $ 177,985
Richard M. Wolfson
2021 $ 270 $ 1,296 $ 23,514 $ 3,917 $ 2,891 $ 0 $ 31,888
Michael T. Hackney
2021 $ 179 $ 1,164 $ 7,988 $ 3,842 $ 2,572 $ 0 $ 15,745
Jill M. Golder
2021 $ 133 $ 654 $ 0 $ 1,703 $ 0 $ 0 $ 2,490
(1)
We provide supplemental long-term disability insurance and life insurance to our executives and certain other employees. The amounts disclosed in this column represent the premiums paid by the Company on behalf of the NEO.
 
42

 
(2)
The amounts disclosed in this column represent 2021 cash dividend equivalents which were or will be paid to the NEO upon the vesting of (i) the 2020 and 2019 LTPP awards (at an assumed target level of performance), and (ii) the 2021 and 2020 Time-based RSU Grants, and (iii) any other time-based RSAs or RSUs granted to an NEO that vested in 2021 or were unvested at the end of 2021. These amounts will be settled in cash upon the vesting of the shares underlying such awards. This column does not include dividend equivalents on the 2020 or 2019 Relative TSR Grants because such amounts were included in the calculation of the grant date fair value of these awards.
(3)
The amounts in this column for Mr. Couvillion represent payments for personal financial advisory services and for Ms. Tate represent expenses incurred in connection with her relocation to Tennessee. These amounts are considered income to the NEO, and the NEO pays the associated taxes.
Grants of Plan-Based Awards Table
The following table sets forth information regarding grants of plan-based awards made to the Named Executive Officers during 2021.
Estimated Future Payouts Under
Non-Equity Incentive Plan Awards(1)
Estimated Future Payouts Under
Equity Incentive Plan Awards(2)
All Other
Stock Awards:
Number of
Shares of
Stock
or Units
(#)(3)
Grant Date
Fair Value
of Stock
and Option
Awards(4)
Name
Grant
Date
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)
Target
(#)
Maximum
(#)
Sandra B. Cochran
$ 0 $ 1,437,500 $ 1,796,875
09/23/20 7,779 19,448 29,172 $ 2,240,604
09/23/20 19,448 $ 2,240,604
P. Douglas Couvillion
$ 0 $ 240,500 $ 300,625
09/23/20 493 1,234 1,851 $ 142,169
09/23/20 1,234 $ 142,169
Jennifer L. Tate
$ 0 $ 202,500 $ 253,125
09/23/20 712 1,780 2,670 $ 205,074
09/23/20 1,780 $ 205,074
08/31/20 3,000 $ 401,130
Richard M. Wolfson
$ 0 $ 292,500 $ 365,625
09/23/20 961 2,403 3,604 $ 276,850
09/23/20 2,403 $ 276,850
Michael T. Hackney
$ 0 $ 276,250 $ 345,313
09/23/20 567 1,418 2,127 $ 163,368
09/23/20 1,418 $ 163,368
Jill M. Golder(5)
$ 0 $ 408,750 $ 510,938
09/23/20 1,455 3,638 5,457 $ 419,134
09/23/20 3,638 $ 419,134
(1)
The amounts shown reflect the possible aggregate payouts under the 2021 annual bonus plan at the “threshold,” “target” and “maximum” levels, pro-rated, in the case of Ms. Tate, to actual dates of service. Actual payouts to each NEO for 2021 were 125% of target and are disclosed in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table. For a discussion of the 2021 annual bonus plan and the 2021 payouts, see “Executive Compensation — Compensation Discussion and Analysis — Overview of Compensation Elements — Annual Bonus Plan.”
(2)
The amounts shown reflect the possible payouts (at grant date fair value) for the LTPP Awards granted under the 2021 LTPP. The grant date fair value of these awards, based on the probable outcome of the relevant performance conditions as of the grant date (computed in accordance with ASC Topic 718) is the amount reported in the “Stock Awards” column of the Summary Compensation Table. Each Named Executive Officers was eligible to receive up to a maximum of 150% of his or her 2021 LTPP target. For a discussion of the 2021 Long-Term Incentive Program, see “Executive
 
43

 
Compensation —  Compensation Discussion and Analysis — Overview of Compensation Elements — Long-Term Incentives.”
(3)
The amounts disclosed in this column reflect the Time-based RSU Grant awarded to each executive in 2021.
(4)
The amounts disclosed in this column reflect the aggregate grant date fair value of the awards calculated in accordance with ASC Topic 718. For the performance-based awards (i.e., the 2021 LTPP), the aggregate grant date fair value has been determined assuming the probable outcome of the performance condition on the date of the grant (i.e., the achievement of the target performance level), excluding the effect of estimated forfeitures. For information regarding the compensation cost of the awards and the assumptions used to calculate grant date fair value of the awards, see Note 10 to the Consolidated Financial Statements included or incorporated by reference in the Company’s Annual Report on Form 10-K for 2021.
(5)
Ms. Golder retired on December 31, 2020, and thus forfeited the amounts reflected in this table.
Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table
Employment Agreement with Named Executive Officers
We currently have one employment agreement with a Named Executive Officer as further described below.
Employment Agreement with Sandra B. Cochran
The Company and Ms. Cochran are parties to the Employment Agreement, entered into on July 27, 2018.
Under the Employment Agreement, Ms. Cochran serves as the Company’s President and Chief Executive Officer, reporting to the Board, and will be nominated annually by the Board to serve as a director throughout her employment. During the term of the agreement measured from the outset of 2021, she will receive an annual base salary of not less than $1,150,000 (her 2021 salary) and an annual bonus opportunity with a target of not less than 125% of annual base salary (her 2021 target bonus opportunity). Additionally, with respect to any of the Company’s long-term incentive plans, Ms. Cochran’s target aggregate award value under such plans will be not less than 380% of her annual base salary (her 2021 target award value). Ms. Cochran will be eligible to participate in the benefit programs and will be entitled to an annual paid vacation commensurate with the Company’s established policy applicable to senior executive officers of the Company. Future adjustments to salary, annual bonus and long-term incentive awards to Ms. Cochran will be as recommended by the Compensation Committee and approved by the Board.
Under the Employment Agreement Ms. Cochran agrees to provide the Company with at least 12 months’ prior notice (or such shorter period as the Board may agree at its discretion) before exercising her right to retire. If she fails to provide such notice, any retirement will be treated as if she voluntarily quit the Company.
As described on pages 33 – 35 of this proxy statement, the Employment Agreement contains certain benefits and imposes certain obligations if the Employment Agreement is terminated without “cause” or “good reason” ​(as defined in the Employment Agreement) and contains certain rights in the event of a change in control of the Company.
Severance Plan and Management Retention Agreements
As described on page 35 of this proxy statement, our executive officers, including all of our Named Executive Officers, are parties to a Severance Agreement and a CIC Agreement which provide them with certain benefits and impose on them certain obligations in the event their employment is terminated without “cause” or “good reason” ​(as defined in these agreements), either in the normal course or following a change in control of the company, respectively. For the reasons described previously, we believe that these agreements are important tools in recruiting and retaining key executives and that the CIC Agreement appropriately aligns the interests of our executives and our shareholders in connection with an actual or potential change of control transaction.
 
44

 
Outstanding Equity Awards at Fiscal Year-End Table
The following table sets forth information regarding equity awards held by the Named Executive Officers as of July 30, 2021.
Option Awards
Stock Awards
Name
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
Option
Exercise
Price
($)
Option
Expiration
Date
Number Of
Shares Or
Units Of
Stock That
Have Not
Vested
(#)
Market
Value Of
Shares Of
Stock
That
Have Not
Vested
($)(11)
Equity
Incentive
Plan Awards:
Number Of
Unearned
Shares,
Units Or
Other
Rights
That
Have Not
Vested
(#)
Equity
Incentive
Plan
Awards:
Market
Or Payout
Value Of
Unearned
Shares,
Units Or
Other
Rights
That
Have Not
Vested
($)(11)
Sandra B. Cochran
19,448(1) $ 2,648,429
6,981(2) $ 950,673
6,431(3) $ 875,774
12,862(4) $ 1,751,547
6,981(5) $ 950,673
6,431(6) $ 875,774
19,448(7) $ 2,648,429
P. Douglas Couvillion
1,234(1) $ 168,046
409(2) $ 55,698
408(3) $ 55,561
816(4) $ 111,123
409(5) $ 55,698
408(6) $ 55,561
1,234(7) $ 168,046
Jennifer L. Tate
1,780(1) $ 242,400
1,780(7) $ 242,400
3,000(8) $ 408,540
Richard M. Wolfson
2,403(1) $ 327,241
751(2) $ 102,271
794(3) $ 108,127
1,589(4) $ 216,390
751(5) $ 102,271
794(6) $ 108,127
2,403(7) $ 327,241
5,000(9) $ 680,900
Michael T. Hackney
1,418(1) $ 193,103
413(2) $ 56,242
827(4) $ 112,621
413(6) $ 56,242
 
45

 
Option Awards
Stock Awards
Name
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
Option
Exercise
Price
($)
Option
Expiration
Date
Number Of
Shares Or
Units Of
Stock That
Have Not
Vested
(#)
Market
Value Of
Shares Of
Stock
That
Have Not
Vested
($)(11)
Equity
Incentive
Plan Awards:
Number Of
Unearned
Shares,
Units Or
Other
Rights
That
Have Not
Vested
(#)
Equity
Incentive
Plan
Awards:
Market
Or Payout
Value Of
Unearned
Shares,
Units Or
Other
Rights
That
Have Not
Vested
($)(11)
1,418(7) $ 193,103
1,000(10) $ 136,180