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While Texas has long been known for its endless spread of barbecue joints, Dallas-based La Madeleine infuses a different kind of country into the Lone Star State. The first La Madeleine, which serves French country cuisine, opened as a bakery on Dallas’ Mockingbird Lane in 1983. Today, of the 62 company-owned restaurants in Texas, Louisiana, Arizona, Georgia, Maryland, Virginia and Washington, D.C., approximately 40 are in Texas. La Madeleine underwent important changes in the past six months. In December 2001, a high-powered Paris-based French bakery and caf� restaurant group called Groupe Le Duff, which has more than 500 bakeries and restaurants worldwide and achieved sales of more than $500 million in 2001, together with a group of North American investors, bought La Madeleine for approximately $60 million. The goal: to recapitalize La Madeleine Inc. and embark on an aggressive expansion plan. (La Madeleine hasn’t opened a new location since 1999.) That’s why, in late March, Wallace “Wally” Doolin came on board as La Madeleine’s CEO. Doolin, former president and CEO of Dallas-based Carlson Restaurants Worldwide, which owns TGI Friday’s Inc., believes the La Madeleine brand can be much larger than it is, particularly given the growth in casual dining. Dining out, in general, is up, according to the Washington, D.C.-based National Restaurant Association. It’s estimated that restaurant industry sales will be $407.8 billion in 2002, up 3.9 percent from 2001, in part because Americans on average eat 4.2 meals prepared away from home each week — 218 meals a year. Whether the new La Madeleine restaurants will be company-owned or franchised remains to be seen. Although Doolin officially started on May 1, he has the benefit of GC Harry Martin’s nearly 15 years of La Madeleine experience. Martin served as La Madeleine’s outside counsel for 11 years until coming in-house approximately four years ago. Doolin and Martin recently shared their insights about the company’s legal needs and challenges with Texas Lawyer reporter Erica Lehrer Goldman. Texas Lawyer: What qualities do you find essential for a GC of a company like La Madeleine? Wallace “Wally” Doolin: … I think the essential qualities are leadership and courage. … You want to make sure you have … leadership, [someone who] knows the right thing to do both from a legal standpoint and … business. They would represent a point of view and be involved in the business. … The courage part comes from being able to stand up, whether it’s against me or anybody else, to express their opinions about what needs to be done — certainly from a legal standpoint but also from a business standpoint. … [T]he one thing that’ll really upset me is to be in meeting and not get lively discussion of a controversial topic. … There needs to be vigorous debate to find the best answer. TL: Is it helpful that GC Harry Martin has been with the company for a long time, as inside and outside counsel? Doolin: It’s really helpful. … I know a lot about the restaurant business — I have a point of view from the past — [but] Harry’s perspective from a legal aspect of what happened at this company over time is invaluable to me, to be able to have that background to look at [with regard to] legal and financial structure of this company. TL: Is the GC a member of the board? Doolin: No. Harry is secretary of our board and sits in at all the meetings. TL: What is your weekly interaction with the legal department, on average? Doolin: Several times a week. It’s not all on legal matters — it may be on business matters. For me … I felt comfortable right off the bat with Harry. … Harry has been an integral part of the executive team and will continue to be. TL: How much autonomy does Martin have? Doolin: Well, you probably have to ask Harry that, but I think a fair amount — the people who are most successful working with me are people who are fairly independent about how they go about their jobs and know how to come to me with issues that I need to deal with but know that I expect them to run their own parts of the business. TL: What role does the GC play in key business decisions? Doolin: Harry is involved in the business from almost all aspects, making key decisions about the business. I want his leadership and opinions on that irrespective of whether it’s a legal issue. … TL: What kinds of issues have you had to handle? Harry Martin: La Madeleine has just surfaced from recapitalizing and restructuring its senior credit facility, so a considerable amount of time has been spent in the past three years accomplishing that goal. As in all restructurings, we had different issues raised from the various equity holders and demands from our lender which had to be resolved. In addition, the normal day-to-day operations create some opportunities in legal and contract compliance as well as associate and guest matters. TL: Given all that you do, how much autonomy do you feel that you have? Martin: La Madeleine has given me a lot of autonomy. We never had in-house counsel, so I charted my own path, and it has worked well. I am looking forward to working with Wally, who has experience with working with a terrific legal team. I am sure he will let me know if I stray off course. LOTS OF INGREDIENTS TL: What is the best thing about your job? Martin: The best part of my job is the opportunity to work in all areas of the business so I am constantly encountering a variety of legal issues internally and, at the same time, keeping in contact with the outside legal community. TL: Does your job require much travel? Martin: I don’t do much traveling, but I do periodically visit all of our markets to give presentations and talk with each of our managers. This is part of the plan to be proactive. TL: How large a legal staff does the company have? Martin: La Madeleine’s legal department consists of my executive administrative assistant and me. My assistant has been with me for more than 20 years [his assistant has been with him since before he joined La Madeleine] and assists in all issues facing the legal department. I also remain in contact with our outside counsel for our special needs. I like to consider all La Madeleine’s officers, directors and managers as part of our legal staff. All of them now can spot and avoid legal issues in operations as well as in contract negotiations so that many of the legal concerns have been resolved before they even get to me. TL: Does the company use a lot of outside legal? Doolin: We have a small staff here with Harry. So we have to use outside counsel. Those are the kinds of decisions I tend to leave to [him] — the attorneys they should use on certain issues. I believe I can’t hold my GC accountable if I’m making decisions about who he or she uses. TL: How do you motivate and retain a legal staff? Doolin: There are two things I think are important, probably more general than specific to La Madeleine, but No. 1, show respect by listening because the legal staff has the responsibility of bringing up important issues [as well as] minute issues, where company or individuals may be in violation of laws, … and No. 2, keep the GC involved in strategy and decision-making. … TL: What did you do prior to joining the company as in-house counsel? Martin: I was in private practice in Dallas after first clerking for the Texas Court of Civil Appeals (as it was then called) for the 11th District and a short tenure with the Dallas County District Attorney’s Office. My private practice started in commercial litigation, which is when I first met Patrick Esquerre, La Madeleine’s founder. I continued to do more corporate, real estate and transactional work for La Madeleine and other clients until La Madeleine asked me to come in-house. TL: What are some of the differences between your role during the 11 years you served as outside counsel to the company and the nearly four years you’ve been in-house? Martin: As outside counsel, I assisted the real estate department in negotiating and documenting the real estate leases, handled the corporate records and was more reactive to La Madeleine’s other challenges. As in-house counsel, I am more involved in all aspects of the company’s business and departments. I advise on human resource issues, review contracts for our improving technology, implement systems for maintaining our contracts and documents, review policies and procedures, participate in business development discussions as well as continue to work with the real estate department, and handle the corporate governance and records. In short, my role and responsibilities have really grown. TL: What in particular made moving in-house an attractive choice for you? Martin: While private practice was enjoyable, I wanted an opportunity to work more closely with the business organization and operations so that I could be more proactive than reactive. TL: What are your short-term and long-term goals with regard to La Madeleine’s legal department? Martin: As we finalize our restructuring, I anticipate our legal needs may change in the process. As our long-term growth strategy develops, we will identify new legal challenges and will respond accordingly. TL: What has been the biggest legal challenge in the past three years? Martin: Completing our recapitalization. It resulted in a win-win-win for our guests, associates and investors.

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