Exhibit 10. 7
Conformed Copy
RETENTION AGREEMENT
THIS AGREEMENT, made as of this NINTH day of January,
1990 (the "Effective Date") by and between DEL MONTE CORPORATION,
a New York corporation (the "Company") and Xxxxx X. Xxxxxx (the
"Executive").
W I T N E S S E T H:
WHEREAS, in order to provide the Executive continued
incentives to remain in the services of the Company, its
subsidiaries or affiliates, the Company desires to provide the
Executive with compensation security under the conditions set
forth in this Agreement in the event that the Executive's
employment hereunder is terminated by the Company or any such
subsidiary or affiliate without Cause (as hereinafter defined) or
the Executive resigns his employment hereunder for Good Reason
(as hereinafter defined);
NOW, THEREFORE, in consideration of the premises and
covenants herein contained, the parties hereto hereby agree as
follows:
1. Employment. The Executive agrees to devote his
working time, on substantially a full-time basis, to the
performance of such services for the Company, its subsidiaries
and affiliates as may be assigned to him from time to time and to
perform such services faithfully and to the best of his ability.
This Agreement shall commence on the Effective Date and shall
remain in effect so long as the Executive remains employed by the
Company, any of its subsidiaries or any successor organization.
2. Termination for Cause; Resignation without Good
Reason; Termination by Reason of Death. (a) This Agreement shall
be terminated immediately and neither party shall have any
obligation hereunder if the Executive's employment is terminated
for Cause (as hereinafter defined) or by reason of the
Executive's death or if the Executive resigns his employment
hereunder for other than Good Reason.
(b) The Executive shall be terminated for "Cause" only
if the Executive's employment is terminated as a result of (i)
criminal dishonesty, (ii) deliberate and continual refusal to
perform employment duties on substantially a full-time basis or
to act in accordance with any specific lawful instructions given
to the Executive in connection with the performance of his duties
for the Company or any of its subsidiaries or affiliates, unless,
in either case, (A) the Executive became aware less than ninety
(90) days prior thereto of an event constituting Good Reason or
(B) the Executive is disabled, or (iii) deliberate misconduct
which is reasonably likely to be materially damaging to the
Company without a reasonable good faith belief by the Executive
that such conduct was in the best interests of the Company.
(c) Resignation for "Good Reason" shall mean the resignation of the
Executive after: (i) a reduction without the Executive's consent
in the Executive's salary or the bonus that the Executive is
eligible to earn under the Company's Annual Incentive Award Plan
(or successor plan thereto); provided, however, that nothing
herein shall be construed to guarantee the Executive's bonus for
any year if the applicable performance targets are not met; and
provided, further, that it shall not constitute Good Reason
hereunder if the Company makes an appropriate pro rata adjustment
to the applicable bonus and targets under the Annual Incentive
Award Plan in the event of a change in the Company's fiscal year;
(ii) a material reduction without the Executive's consent in the
aggregate welfare benefits provided to the Executive pursuant to
the welfare plans, programs and arrangements in which the
Executive participated at any time during the three (3) month
period immediately prior to the Effective Date; or (iii) a
material reduction without the Executive's consent in the
Executive's job responsibilities. Unless the Executive provides
written notification of an event described in clauses (i) through
(iii) above within ninety (90) days after the Executive knows or
has reason to know of the occurrence of any such event, the
Executive shall be deemed to have consented thereto and such
event shall no longer constitute Good Reason for purposes of this
Agreement. If the Executive provides such written notice to the
Company, the Company shall have ten (10) business days from the
date of receipt of such notice to effect a cure of the event
described therein and, upon cure thereof by the Company to the
reasonable satisfaction of the Executive, such event shall no
longer constitute Good Reason for purposes of this Agreement.
3. Termination Without Cause; Resignation for Good Reason.
(a) Severance Amount. If the Executive's employment
hereunder is terminated by the Company without Cause, or if the
Executive resigns from his employment hereunder for Good Reason,
the Company shall pay to the Executive the Severance Amount (as
hereinafter defined) over a three (3) year period commencing with
the date of such termination or resignation (the "Severance
Period"). The total severance amount (the "Severance Amount") for
the Severance Period shall equal twice the sum of (A) plus (B),
where (A) is the Executive's highest annual rate of Salary in
effect during the twelve (12) month period prior to such
termination or resignation and (B) is the target award under the
Company's Annual Incentive Award Plan (or successor thereto) for
the year in which such termination or resignation occurs (or, if
greater, the amount of the award for the next preceding year of
full-time employment). The Severance Amount shall be paid to the
Executive in thirty-six (36) equal monthly installments over the
Severance Period and each such installment shall be subject to
regular payroll deductions. In addition, the Executive will also
be paid an award under the Annual Incentive Award Plan (or
successor thereto, if any) of the Company, based upon the target
award for the year in which the Executive's termination without
Cause or resignation for Good Reason occurs, prorated for the
Executive's active employment during such year and adjusted for
performance. Such pro rata bonus shall be paid within thirty (30)
days of the date of such termination or resignation.
(b) Employee Benefit Plans. In the event of a
termination or resignation of the Executive's employment
described in this Section 3, the Executive will be provided the
welfare benefits afforded by the employee benefit plans and
programs maintained by the
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Company in which he participated (and at an equivalent level of
participation) immediately prior to such termination or
resignation (or, in the event of any material reduction in the
aggregate benefits provided under such plans and programs
occurring during the twelve (12) month period prior to such
termination or resignation, prior to such reduction in benefits)
until the earlier to occur of (i) the end of the Severance Period
or (ii) such time as the Executive is covered by comparable
programs of a subsequent employer. Subject to the provisions of
applicable law, if the Executive was participating in a qualified
defined benefit retirement plan prior to a termination or
resignation described in this Section 3, he shall continue to
accrue benefits under such plan during the Severance Period and,
in addition, if the Executive was participating in a qualified
defined contribution retirement plan prior to any such
termination or resignation, he shall continue to so participate
(if he so elects) during the Severance Period, as if he were then
still employed hereunder. During the Severance Period, the
Executive shall also participate, if he so elects, in any
nonqualified retirement plan of the Company or any of its
subsidiaries on the same terms and conditions applicable to the
Executive immediately prior to such termination or resignation.
Anything herein to the contrary notwithstanding, the Company
shall have no obligation to continue to maintain during the
Severance Period any plan solely as a result of the provisions of
this Agreement. If, during the Severance Period, the Executive is
precluded from participating in a plan by its terms or applicable
law or if the Company for any reason ceases to maintain such
plan, the Company shall provide the Executive with benefits which
are no less favorable in the aggregate to those which the
Executive would have received under such plan had he been
eligible to participate therein or had such plan continued to be
maintained by the Company.
(c) Facilities. During the first six (6) months of the
Severance Period, the Executive will, at his option, be provided
with an office and secretarial services during regular business
hours at a location selected by him subject to the consent of the
Company, which shall not be unreasonably withheld. Except as may
be specifically approved by the Board, the Executive will not be
provided with the use of any other Company facility or services
during the Severance Period or at any time thereafter.
(d) Death. In the event of the Executive's death
subsequent to commencement of the Severance Period, the balance
of the Severance Amount will be paid to his beneficiary in a lump
sum. "Beneficiary" shall mean the person or persons designated by
the Executive in writing to the Company to receive payments under
this Agreement or, if no such person or persons are designated,
the Executive's estate.
(e) Pension Calculations. Notwithstanding any
provision to the contrary herein, pension accruals during the
Severance Period under the cash balance portion of the Company's
qualified defined benefit retirement plan shall be calculated on
the actual amounts paid to the Executive for each applicable plan
year of such plan and calculations under such plan based on
"average final compensation" shall be calculated during the
Severance Period based on an annual rate of Salary and bonus
equal to one-half (1/2) of the total Severance Amount.
(f) Outplacement Counseling. During the Severance
Period, the Executive will be provided with Outplacement
counseling services at Company expense; provided,
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however, the expense for such services in any calendar year shall
not exceed eighteen percent (18%) of the Severance Amount paid to
the Executive for such calendar year. This counseling shall
include, but not be limited to, skill assessment, job market
analysis, resume preparation, interviewing skills, job search
techniques and negotiating.
(g) Fringe Benefits. The Company will continue the
Executive's participation in the Management Program until the
earlier to occur of (i) the first anniversary of such termination
or resignation or (ii) the date the Executive is covered by
comparable fringe benefit programs and perquisites of a
subsequent employer.
4. Disability. The event of Permanent Disability (as
hereinafter defined) shall not entitle the Executive to any of
the payments or benefits described in Section 3 above unless the
Executive is terminated by the Company other than for Cause or
the Executive resigns for Good Reason. "Permanent Disability"
shall mean physical or mental disability as a result of which the
Executive is unable to perform his duties with the Company on
substantially a full-time basis for any period of six (6)
consecutive months. Any dispute as to whether or not the
Executive is so disabled shall be resolved by a physician
reasonably acceptable to the Executive and the Company whose
determination shall be final and binding upon both the Executive
and the Company.
5. Conditions Applicable to Severance Benefits.
(a) Confidentiality and Conduct. The Executive
warrants and agrees that he will not disclose to any person,
other than the employees, officers, directors or shareholders of
DMPF Holdings Corporation, a Maryland corporation, or its
affiliates and subsidiaries in connection with the performance of
his duties hereunder, any confidential information or trade
secrets concerning the Company or any of its subsidiaries or
affiliates at any time. Notwithstanding the foregoing,
confidential information and trade secrets shall not be deemed to
include, without limitation, information which (i) is or becomes
available to the public other than as a result of disclosure by
the Executive in violation of this Section 5(a) or (ii) the
Executive is required to disclose under any applicable laws,
regulations or directives of any government agency, tribunal or
authority having jurisdiction in the matter or under subpoena or
other process of law. The Executive will at all times refrain
from taking any action or making any statements, written or oral,
which are intended to and do demonstrably and materially damage
the Company, its subsidiaries and affiliates and their respective
directors, officers or employees. In the event that the Executive
materially violates the terms and conditions of this Section
5(a), the Company may, at its election, upon ten (10) days'
notice, terminate the Severance Period and discontinue payments
of the Severance Amount and cease providing the benefits
described in Section 3 above. The Company may also initiate any
form of legal action it may deem appropriate seeking damages or
injunctive relief with respect to any material violations of this
Section 5(a).
(b) Non-Competition. The Severance Period shall be
terminated and the Company shall have no further obligation to
pay the Severance Amount or to provide the benefits described in
Section 3 above if the Executive, without the Company's written
approval,
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accepts a position of employment with any other company
conducting a business which is substantially competitive with a
business conducted by the Company.
(c) No Other Severance Benefits. Except as
specifically set forth in this Agreement, the Executive covenants
and agrees that he shall not be entitled to any other form of
severance benefits from the Company, including, without
limitation, benefits otherwise payable under any of the Company's
regular severance policies, in the event his employment with the
Company ends for any reason and, except with respect to
obligations of the Company expressly provided for herein, the
Executive unconditionally releases the Company and its
subsidiaries and affiliates, their respective directors,
officers, employees and stockholders, or any of them, from any
and all claims, liabilities or obligations under this Agreement
or under any severance or termination arrangement of the Company
or any of its subsidiaries or affiliates for compensation or
benefits in connection with his employment or the termination
thereof.
6. General Provisions.
(a) Notices. Any notice hereunder by either party to
the other shall be given in writing by personal delivery, telex,
telecopy or registered mail, return receipt requested, to the
applicable address set forth below:
(i) To the Company:Del Monte Corporation
Xxx Xxxxxx Xxxxx
X.X. Xxx 0000
Xxx Xxxxxxxxx, XX 00000
Attn.: Secretary of the Board
With a Copy to:Xxxxx X. Xxxxxxxxxx, III
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
(ii) To the Executive:Avid M. Little
0000 Xxxx Xxxxx Xx.
Xxxxxx Xxxxx, XX 00000
(b) Limited Waiver. The waiver by the Company or the
Executive of a violation of any of the provisions of this
Agreement, whether express or implied, shall not operate or be
construed as a waiver of any subsequent violation of any such
provision.
(c) No Assignment. No right, benefit or interest
hereunder shall be subject to assignment, encumbrance, charge,
pledge, hypothecation or set off by the Executive in respect of
any claim, debt, obligation or similar process. This Agreement
and all of the Company's rights and obligations hereunder may be
assigned, transferred or delegated to any business entity which,
at the time of any sale, merger, consolidation or other business
combination, acquires all or substantially all of the assets of
the Company or to which the Company transfers all or
substantially all of its assets, but no such assignment, transfer
or delegation shall impair any
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rights that the Executive may have hereunder. Upon such
assignment, transfer or delegation, any such business entity
shall be deemed to be substituted for all purposes as the Company
hereunder; provided, however, that no such assignment, transfer
or delegation shall relieve the Company of its obligations under
this Agreement in the event that such obligations are not
performed when due by any such successor to the Company
hereunder.
(d) Amendment. This Agreement may not be amended,
modified or cancelled except by written agreement of the parties.
(e) Severability. In the event that any provision or
portion of this Agreement shall be determined to be invalid or
unenforceable for any reason, the remaining provisions of this
Agreement shall remain in full force and effect to the fullest
extent permitted by law.
(f) Unsecured Promise. Unless otherwise stated herein,
no benefit or promise hereunder shall be secured by any specific
assets of the Company. Unless otherwise stated herein, the
Executive shall have only the rights of an unsecured general
creditor of the Company in seeking satisfaction of such benefits
or promises
(g) Governing Law. This Agreement has been made in and
shall be governed by and construed in accordance with the laws of
the State of New York.
(h) Entire Agreement. This Agreement sets forth the
entire agreement and understanding of the parties hereto with
respect to the matters covered hereby. As of the Effective Date,
this Agreement supersedes and replaces any prior agreement with
respect to employment, compensation continuation and the matters
contained in this Agreement which the Executive may have had with
the Company or any prior or contemporary affiliate or subsidiary
thereof, including, without limitation, any prior employment
agreement between RJR Nabisco, Inc., a Delaware corporation
("RJR"), and the Executive; provided, however, that nothing in
this Agreement shall be construed in any manner as a release or
waiver of RJR's obligations with respect to any bonus the
Executive is due for the period ending on the Effective Date or
the Executive's salary or retirement benefits with RJR accrued
prior to the Effective Date.
(i) Headings. The headings and captions of the
Sections of this Agreement are included solely for convenience of
reference and shall not control the meaning or interpretation of
any provisions of this Agreement.
(j) Counterparts. This Agreement may be executed by
the parties hereto in counterparts, each of which shall be deemed
an original, but both such counterparts shall together constitute
one and the same document.
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IN WITNESS WHEREOF, the parties have executed this
Agreement effective as of the day and year first written above.
DEL MONTE CORPORATION
By: /s/ A. Xxxx Xxxxxxxxx
Title:
/s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
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