DEL MONTE FOODS COMPANY PERFORMANCE ACCELERATED RESTRICTED STOCK AGREEMENT
Exhibit
10.4
DEL MONTE FOODS COMPANY
PERFORMANCE ACCELERATED RESTRICTED STOCK
This agreement (the “Agreement”) contains the terms and conditions under which the
Compensation Committee of the Board (the “Committee”), on behalf of Del Monte Foods Company
(“Company”) has granted to you, (the “Participant”), as of [DATE], and pursuant to
the Del Monte Foods Company 2002 Stock Incentive Plan (the “Plan”), units representing the Common
Stock of the Company known as “Performance Accelerated Restricted Stock” (“PARS”), in order to
encourage you to continue in the Company’s employment and contribute to its growth and success.
1. Grant of PARS. The PARS grant consists of units representing shares of the
Common Stock of the Company, which the Company has issued to the Participant as of the date hereof
as a separate incentive in connection with his or her service to the Company and not in lieu of any
salary or other compensation for his or her services. The PARS also shall include any new,
additional, or different securities or units representing such securities the Participant may
become entitled to receive with respect to such PARS by virtue of any increase or decrease in the
number of issued shares of Common Stock resulting from a subdivision or consolidation of shares of
Common Stock, or the payment of a stock dividend (but only on shares of Common Stock), or any other
increase or decrease in the number of such shares effected without receipt or payment of
consideration by the Company, or any change in the capitalization of the Company pursuant to
Section 10(b) of the Plan, or by virtue of any Change of Control or other transaction pursuant to
Section 10(c) of the Plan. The PARS shall be subject to the Restrictions pursuant to Section 3 of
this Agreement.
2. Participant’s Account; Certain Rights in Respect of PARS.
(a) The PARS granted to the Participant shall be entered into an account in the Participant’s
name. This account shall be a bookkeeping entry only and shall be utilized solely as a device for
the measurement and determination of the number of shares of Common Stock to be paid to or in
respect of a Participant pursuant to this Agreement.
(b) During the period before the release of the Restrictions on the PARS as provided in
Section 4, the Participant shall have no voting rights in respect of the PARS.
(c) Dividend equivalents will be credited in the form of additional PARS to the Participant’s
account, based on the Fair Market Value of Common Stock on the date the dividend is issued.
3. Restrictions. Prior to their release from the Restrictions as provided in Section
4, all PARS held for or in respect of the Participant, and the shares of Common Stock that such
PARS represent, may not be assigned, transferred, or otherwise encumbered or disposed of by the
Participant.
4. Release of PARS from Restrictions.
(a) Subject to the provisions of paragraph (d) of this Section 4, the Restrictions shall cease
to apply to the PARS granted under this Agreement on [DATE], or upon the earlier occurrence of a
Change of Control or the death or Disability of the Participant; provided, however, that release of
the PARS from the Restrictions shall be accelerated as provided in paragraphs (b) and (c) of this
Section 4. Upon the release of the PARS from the Restrictions (except if receipt of the PARS is
deferred as provided in Section 5), the Participant shall be paid the value of his or her account
in the form of Common Stock. No fractional shares of Common Stock will be issued. If the
calculation of the number of shares of Common Stock to be issued results in fractional shares, then
the number of shares of Common Stock will be rounded up to the nearest whole share of Common Stock.
(b) The Committee, in its sole discretion, shall define a peer group of companies (the
“Comparator Group”), either within or without the Company’s industry, against which the Company’s
Total Stockholder Return (“TSR”) will be compared. The Comparator Group shall be identified as
soon as practicable after the date of this Agreement and may be changed by the Committee from time
to time. Any adjustment to the TSR calculation to account for changes in the Comparator Group,
including changes in the capitalization of Comparator Group companies (due to stock splits,
mergers, spin-offs, etc.), will be made at the sole discretion of the Committee. If the Company
achieves the designated TSR targets, the Restrictions shall cease to apply to the PARS at the end
of the last day of the applicable fiscal year of the Company, according to the following schedule:
Accelerated Vesting Schedule for TSR Targets
| Percent of PARS Released | ||||||
| from Restrictions as of | ||||||
| Target | Achievement Date | Achievement Date | ||||
Company TSR ³
75th
percentile of Comparator Group
|
Target must be achieved as of fiscal year end [YEAR] | 100 | % | |||
Company TSR ³
55th
percentile of Comparator Group
|
Target must be achieved as of fiscal year end [YEAR] | 100 | % | |||
The Committee shall have sole discretion to determine whether the TSR targets have been achieved
and whether the Restrictions shall be released from the PARS. The Committee’s determinations
pursuant to the exercise of discretion with respect to all matters described in this paragraph
shall be final and binding on the Participant.
(c) In the case of the Participant’s Retirement prior to the time at which the PARS otherwise
would be released from the Restrictions pursuant to paragraphs (a) or (b) of this Section 4, the
Restrictions shall cease to apply on a pro-rata basis pursuant to the Company’s pro-rata vesting
policy in effect at the time of Retirement.
(d) Upon the termination of the Participant’s employment for any reason other than the
Participant’s death, Disability or Retirement, any PARS that remain subject to the Restrictions at
such time shall be forfeited by the Participant to the Company; provided that, for
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Participants covered under the Executive Severance Policy or who are parties to an employment
agreement with the Company or a Subsidiary of the Company, in the case of termination of employment
without Cause or resignation for Good Reason (as defined in the Executive Severance Policy or
employment agreement, as applicable), the Restrictions shall cease to apply on a pro-rata
basis pursuant to the Company’s pro-rata vesting policy in effect at the time of such termination
or resignation.
5. Deferral. The Committee has the right to determine, in its sole discretion,
whether and in what manner Participants shall be permitted to elect to defer the receipt of a
distribution of Common Stock in respect of the PARS under a deferral plan of the Company, in which
case the PARS would remain as stock equivalent units in the Participant’s account. Stock
equivalent units held in the Participant’s account pursuant to this Section 5 shall accrue dividend
equivalents that will be credited in the form of additional stock equivalent units to the
Participant’s account, based on the Fair Market Value of Common Stock on the date the dividend is
issued. At the end of the deferral period, all stock equivalent units will be converted and
distributed to the Participant in the form of Common Stock. No fractional shares of Common Stock
will be issued. If the calculation of the number of shares of Common Stock to be issued results in
fractional shares, then the number of shares of Common Stock will be rounded up to the nearest
whole share of Common Stock.
6. Designation of Beneficiary. The Participant may designate a beneficiary or
beneficiaries to whom, along with all other grants or awards made to the Participant under the
Plan, the Common Stock that is distributed on account of the PARS that become vested at the
Participant’s death shall be transferred. A Participant shall designate his or her beneficiary by
executing the “2002 Stock Incentive Plan Beneficiary Designation and Spousal Consent Form” and
returning it to the Corporate Secretary. Any form so submitted shall replace, in respect of all
grants or awards made to the Participant under the Plan, any previous version of the same form the
Participant may have submitted to the Corporate Secretary. A Participant shall have the right to
change his or her beneficiary from time to time by executing a subsequent “2002 Stock Incentive
Plan Beneficiary Designation and Spousal Consent Form” and otherwise complying with the terms of
such form and the Committee’s rules and procedures, as in effect from time to time. The Committee
shall be entitled to rely on the last “2002 Stock Incentive Plan Beneficiary Designation and
Spousal Consent Form” submitted by the Participant, and accepted by the Corporate Secretary, prior
to such Participant’s death. In the absence of such designation of beneficiary, Common Stock that
is distributed on account of PARS that become vested at the Participant’s death will be transferred
to the Participant’s surviving spouse, or if none, to the Participant’s estate. If the Committee
has any doubt as to the proper beneficiary, the Committee shall have the right, exercisable in its
sole discretion, to withhold such payments until this matter is resolved to the Committee’s
satisfaction.
7. Taxes. The Company may, in its discretion, make such provisions and take such
steps as it may deem necessary or appropriate for the withholding of all federal, state, local and
other taxes required by law to be withheld with respect to the vesting of any PARS or the
distribution of Common Stock on account of the vesting of any PARS, including, but not limited to,
withholding shares of Common Stock granted under this Agreement equal in value to such withholding
taxes, deducting the amount of such withholding taxes from any other amount then or thereafter
payable to the Participant, or requiring the Participant or the beneficiary or legal
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representative of the Participant to pay in cash to the Company the amount required to be
withheld or to execute such documents as the Company deems necessary or desirable to enable it to
satisfy its withholding obligations.
8. No Special Rights; No Right to Future Awards. Nothing contained in this Agreement
shall confer upon any Participant any right with respect to the continuation of his or her service
with the Company, or any right to receive any other grant, bonus, or other award.
9. Address for Notices. Any notice to be given to the Company under the terms of this
Agreement shall be addressed to the Company, in care of its Corporate Secretary, at One Market @
the Landmark, Xxx Xxxxxxxxx, XX 00000, or at such other address as the Company may hereafter
designate in writing.
10. Other Benefits. The benefits provided to the Participant pursuant to this
Agreement are in addition to any other benefits available to such Participant under any other plan
or program of the Company. The Agreement shall supplement and shall not supersede, modify, or
amend any other such plan or program except as may otherwise be expressly provided.
11. Plan Governs. This Agreement is subject to all of the terms and provisions of the
Plan. In the event of a conflict between one or more provisions of this Agreement and one or more
provisions of the Plan, the provisions of the Plan shall govern. Capitalized terms and phrases
used and not defined in this Agreement shall have the meaning set forth in the Plan.
12. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of California, without reference to its principles of conflicts of laws.
13. Committee Authority. The Committee shall have all discretion, power, and
authority to interpret the Plan and this Agreement and to adopt such rules for the administration,
interpretation, and application of the Plan as are consistent therewith. All actions taken and all
interpretations and determinations made by the Committee in good faith shall be final and binding
upon the Participant, the Company, and all other interested persons, and shall be given the maximum
deference permitted by law. No member of the Committee shall be personally liable for any action,
determination, or interpretation made in good faith with respect to the Plan or this Agreement.
14. Captions. The captions provided herein are for convenience only and are not to
serve as a basis for the interpretation or construction of this Agreement.
15. Agreement Severable. In the event that any provision in this Agreement shall be
held invalid or unenforceable, such provision shall be severable from, and such invalidity or
unenforceability shall not be construed to have any effect on, the remaining provisions of this
Agreement.
16. Definitions. For purposes of this Agreement, words and phrases bearing initial
capital letters shall have the meanings assigned in the Plan, and the following words and phrases
shall have the following meanings unless a different meaning is plainly required by the context:
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(a) “Restrictions” means those restrictions on the PARS set forth in Section 3.
(b) “Total Stockholder Return” means, for any stock of a Comparator Group company, the
number determined by (1) subtracting the average of the closing prices or, for days on which no
trading occurred, the last bid prices for each business day during a specified calendar month on
the stock’s principal exchange or national over-the-counter market quotation system (the “Average
Closing Price”) from the sum of (x) the Average Closing Price of that stock for a subsequent
specified calendar month (adjusted for stock splits, recapitalizations, or similar events) and (y)
all dividends paid between the first day of the first specified month and the last day of the
second specified calendar month and (2) dividing the result obtained in step (1) by the Average
Closing Price for the first specified calendar month.
| DEL MONTE FOODS COMPANY | PARTICIPANT | |||||||
By: |
||||||||
| Title: Vice President, Human Resources | EMPLOYEE NAME | |||||||
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