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EXHIBIT 10
FIRST AMENDMENT OF SEVERANCE AGREEMENT
FIRST AMENDMENT TO THE
SEVERANCE AGREEMENT
WHEREAS, the Executive and the Company have entered into a severance
agreement, dated ________, _____ , by and between BESTFOODS (formerly CPC
INTERNATIONAL INC.), a Delaware corporation (the "Company"), and
_____________(the "Executive") (referred to hereinafter as the "Agreement"); and
WHEREAS, the Executive is a key employee of the Company or a Subsidiary
of the Company as defined in the Agreement; and
WHEREAS, the Board of Directors of the Company (the "Board") continues
to consider the maintenance of a sound management to be essential to protecting
and enhancing the best interests of the Company and its stockholders and
recognizes that the possibility of a change in control raises uncertainty and
questions among key employees and may result in the departure or distraction of
such key employees to the detriment of the Company and its stockholders; and
WHEREAS, the Board wishes to assure that it will have the continued
dedication of the Executive and the availability of the Executive's advice and
counsel notwithstanding the possibility, threat or occurrence of a bid to take
over control of the Company, and to induce the Executive to remain in the employ
of the Company or a Subsidiary; and
WHEREAS, the Executive is willing to continue to serve the Company and
its Subsidiaries taking into account the provisions of the Agreement; and
WHEREAS, pursuant to Section 7(i) of the Agreement, the Agreement may
be amended by an instrument in writing signed by the Company and the Executive;
and
WHEREAS, the Board wishes to amend the Agreement.
NOW, THEREFORE, in consideration of the foregoing, and the respective
covenants and agreements of the parties contained within the Agreement and
herein, the parties agree to amend the Agreement (which may be effected in
signed counterparts each of which will be deemed an original, but all of which
together will constitute one and the same instrument) as of the date first
indicated below and in the manner provided below:
1. Section 1
Section 1 is deleted in its entirety, and replaced with the following:
1. Change in Control and Anticipatory Change in Control. Benefits shall
be provided under Section 3 hereof only if (1) a Change in Control
occurs and (2) the Executive's employment by the Company and its
Subsidiaries shall have terminated in accordance with Section 2 below
within the "Protection Period" as defined below, provided, however,
that benefits under Section 3(iii) of this Agreement shall commence at
the time of an Executive's termination of employment if such
termination occurs after an "Anticipatory Change in Control", but shall
be discontinued if a determination is made (pursuant to Section 1(iii)
of this Agreement) that such Anticipatory Change in Control has ended.
If any Protection Period terminates without the Executive's employment
having terminated, any subsequent "Change in Control" or "Anticipatory
Change in Control" shall give rise to a new Protection Period. No
benefits shall be paid under Section 3 of this Agreement if the
Executive's employment terminates outside of a Protection Period.
(i) For purposes of this Agreement, the term
"Anticipatory Change in Control" shall mean the occurrence of
any of the following events:
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(A) the execution of an agreement or written
document which, if the subject thereof were consummated, would
result in a Change in Control; or
(B) a public announcement by any person(s),
including the Company, of an intent to take action(s), which,
if consummated, would result in a Change in Control; or
(C) the date of the delivery of a signed,
written statement to the Compensation and Nominating Committee
of the Board or any successor thereto (the "Committee") by the
Executive Vice President, Strategic Business Development &
Finance or General Counsel of the Company that a Change in
Control is reasonably expected to take place within the next
12 months, provided that the Committee approves of the
statement of the Executive Vice President, Strategic Business
Development & Finance or General Counsel within thirty (30)
days of receipt thereof.
(ii) For purposes of this Agreement, the term "Change
in Control" shall mean:
(A) any person (within the meaning of
Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended) ("Person") (but excluding the Company, a
Subsidiary, or a trustee or other fiduciary holding securities
under an employee benefit plan or employee stock plan of the
Company or a Subsidiary) becomes, directly or indirectly, the
"beneficial owner" (as defined in Rule 13d-3 under the
Securities Exchange Act of l934, as amended) of 15% or more of
the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of
directors ("Voting Securities") of the Company, provided,
however, that there shall be excluded, for this purpose, any
acquisition of Voting Securities either from the Company or
pursuant to a Stock Combination (as defined hereinafter); or
(B) any Person commences a tender offer or
exchange offer which, if successful, would result in such
Person becoming the "beneficial owner" of at least 15% of the
outstanding Voting Securities of the Company; provided,
however, that the Board shall have the right to delay the date
on which a Change in Control shall be deemed to occur pursuant
to this clause (B), but in no event beyond the earlier of (a)
the date of the public announcement that the Board has
determined to recommend, or remain neutral toward, such offer,
or (b) the earliest date on which there is a purchase of any
Voting Securities of the Company pursuant to such offer; or
(C) during any period of two consecutive
years individuals who at the beginning of such period
constitute the Board (including for this purpose any new
director whose election by the Board or nomination for
election by the Company's stockholders was approved by a vote
of at least two-thirds of the directors then still in office
who either were directors at the beginning of the period or
whose election or nomination for election was previously so
approved (such individuals and such new directors being
"Continuing Directors")) cease for any reason to constitute a
majority of the Board; or
(D) the stockholders of the Company approve
a merger, consolidation, reorganization or sale of
substantially all of the assets of the Company ("Combination")
with any other corporation or legal person, other than a
Combination which (a) is approved by a majority of the
directors of the Company who are Continuing Directors at the
time of such approval, and (b) would result in the Common
Stock of the Company outstanding immediately prior thereto
remaining outstanding or being converted into voting common
stock, or its equivalent, of either
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the surviving entity or the Person owning directly or
indirectly all the common stock, or its equivalent, of the
surviving entity which voting common stock, or its equivalent,
is listed on a registered United States national securities
exchange or is approved for quotation and trading on the
National Association of Securities Dealers Automated Quotation
National Market System ("Stock Combination"); or
(E) the stockholders of the Company approve
a plan of complete liquidation of the Company or an agreement
for the sale or disposition by the Company of all or
substantially all the Company's assets.
(iii) For purposes of this Agreement, the term
"Protection Period" shall mean the period beginning on the
date of the Anticipatory Change in Control and ending on the
earlier of the (a) second anniversary of the date of the
Change in Control, or (b) a written determination by the
Executive Vice President, Strategic Business Development &
Finance or the General Counsel of the Company, approved by
either the Board of Directors of the Company, the outside
directors of the Board, or the Committee, that an Anticipatory
Change in Control has ended without concluding in a Change in
Control.
(iv) For purposes of this Agreement, the term
"Subsidiary" shall mean any corporation in which the Company
possesses directly or indirectly fifty percent (50%) or more
of the total combined voting power of all classes of stock.
2. Section 2
The first paragraph of Section 2 is deleted in its entirety and replaced
with the following:
Termination Within a Protection Period. Following a Change in Control,
the Executive shall be entitled to the benefits provided in Sections
3(i)-(ii) and (iv)-(vi) hereof upon any terminatio of his or her
employment with the Company and its Subsidiaries within a Protection
Period, except a termination of employment (a) because of his or her
death, (b) because of a "Disability", (c) because of "Normal
Retirement", (d) by the Company for "Cause", or (e) by the Executive
other than for "Good Reason." Following an Anticipatory Change in
Control or a Change in Control, the Executive shall be entitled to the
benefits provided in Sections 3(iii) hereof upon any termination of his
or her employment with the Company and its Subsidiaries within a
Protection Period, except a termination of employment (a) because of
his or her death, (b) because of a "Disability", (c) because of "Normal
Retirement", (d) by the Company for "Cause", or (e) by the Executive
other than for "Good Reason."
3. Section 2(ii)
The phrase "Bestfoods Non-Contributory Pension Plan for Salaried Employees, or a
similar pension plan of a Subisidiary, or a successor plan to such Retirement
Plan" is deleted from paragraph (ii) of Section 2 and is replaced with the
phrase "Bestfoods Cash Balance Pension Plan for Salaried Employees or any
successor plan (the "Retirement Plan")," and thereafter the phrase
"Non-Contributory Pension Plan" shall be replaced with the phrase "Retirement
Plan."
4. Section 2(iii)
The phrase "Compensation and Nominating Committee of the Board or any successor
thereto (the "Committee")" is deleted from paragraph (iii) of Section 2 and is
replaced with the word "Committee."
5. Section 3
The phrase "Subject to the provisions of Section 2," is inserted prior to the
first sentence of Section 3.
6. Section 3(iii)
Paragraph (iii) of Section 3 is deleted in its entirety and replaced with the
following:
(iii) During the period of 36 months beginning on the date of the
Executive's termination of employment (the "Benefit Period"), the
Executive shall be deemed to remain an employee of the Company or the
applicable Subsidiary for purposes of the applicable medical and
insurance plans of the
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Company and its Subsidiaries (but excluding any disability, business
travel, or spending account plans), and shall be entitled to receive
the benefits available to employees thereunder, provided that continued
participation is possible under applicable law and the terms of such
plan or program, and provided, further, that if the Executive would
qualify for retiree benefits during the Benefit Period under the
applicable medical or insurance plan without regard to this Agreement,
the Executive shall instead be entitled to receive the benefits
available to retirees in accordance with the terms of such plan. In the
event that the Executive's participation in any such benefit plan or
program is barred, the Company shall arrange to provide the Executive
with substantially similar benefits.
7. Section 3(iv)
The first paragraph of paragraph (iv) of Section 3 is deleted in its entirety
and replaced with the following:
(iv) As of the date of the later of the Executive's termination of
employment or the Change in Control, the Company shall supplement the
benefits payable under the Retirement Plan and the Bestfoods Excess
Benefit Plan or any successor plan (the "Excess Plan") (all determined
without regard to this Section 3) by providing to the Executive the
additional benefits that the Executive would have been entitled to
receive if he or she had remained in the employment of the Company
during the Benefit Period earning compensation at the rate in effect on
the date his or her employment terminates. The supplemental benefits
pursuant to this subsection (iv) in respect of the Retirement Plan and
the Excess Plan shall be treated as additional benefits under the
Excess Plan, shall be payable in the same form and commencing at the
same time as benefits payable under the Excess Plan, and shall be
subject to the provisions of the Excess Plan. The Executive's
beneficiary with respect to such benefits shall be the same person or
persons as determined under the Excess Plan.
8. Section 3(vi)
Section 3 is amended to include this new section (vi), which reads as follows:
(vi) In the event of a Change in Control, with respect to terminations
prior to such Change in Control but on or after an Anticipatory Change
in Control which relates to such Change in Control, notwithstanding
anything in the Bestfoods 1993 Stock and Performance Plan (the "Stock
and Performance Plan") or an award thereunder to the Executive to the
contrary, (A) the Executive's rights under his options shall not
terminate and such options shall become vested under Section 2.3(b) of
the Stock and Performance Plan as if the Executive were employed as of
the date of such Change in Control, and for purposes of Sections 2.3(d)
of the Stock and Performance Plan, such options shall be exercisable
following the date of termination of employment, but in no event after
their respective expiration dates, (B) any restrictions shall lapse as
under Section 3.2(e) of the Stock and Performance Plan as if the
Executive were employed as of the date of such Change in Control, and
(C) the Executive will receive the amounts he would have received under
Section 4.6 of the Stock and Performance Plan as if he were employed as
of the date of such Change in Control.
9. Section 8
The title "Vice President" is amended to read "Senior Vice President."
10. Section 9
Section 9 is deleted in its entirety and amended to read as follows:
9. Miscellaneous; Pooling Transactions. (a) No
provision of this Agreement may be waived or modified unless such
waiver or modification is in writing and signed by the Executive and
the Company's Chief Executive Officer or such other officer as may be
designated by the Board. No waiver by either party of any breach by
the other party of, or compliance with, any provision of this
Agreement shall be deemed a waiver of similar or dissimilar provisions
at the same or any prior or subsequent time. The validity,
interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of New Jersey, without regard to
its principles of conflict of laws, and by applicable laws of the
United States.
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(b) Notwithstanding anything contained in the Agreement to the
contrary, in the event of a Change in Control that is also intended to
constitute a transaction to be accounted for as a "pooling of
interests" under generally accepted accounting principles, the
Committee shall take such actions, if any, as are specifically
recommended by an independent accounting firm retained by the Company
to the extent reasonably necessary in order to assure that the
transaction will qualify as such, including but not limited to (a)
deferring any payment or benefits provided for in connection with an
Anticipatory Change in Control, (b) providing that any such payment
provided for in connection with an Anticipatory Change in Control be
made in the form of cash, common stock or securities of a successor or
acquirer of the Company, or a combination of the foregoing, and (c)
providing that any such payments or benefits provided for in connection
with an Anticipatory Change in Control not be paid with respect to the
Change in Control.
11. Company Name
Reference to the Company as "CPC International Inc." is deleted and replaced
with the name "Bestfoods."
12. Effective Date
This First Amendment to the Severance Agreement shall be effective as of May 16,
2000.
IN WITNESS WHEREOF, the parties have executed this First Amendment to the
Severance Agreement on the day and year indicated below.
BESTFOODS
By:
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Name:
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Title:
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Date:
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EXECUTIVE
By:
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Name:
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Date:
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