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EXHIBIT 10 (a)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement"), dated January 8, 2001
(the "Effective Date"), is made and entered into by and between Xxxxxxxx Soup
Company, a New Jersey corporation (the "Company"), and Xxxxxxx X. Xxxxxx (the
"Executive").
WHEREAS, the Company desires to secure the Executive's participation
in the manner hereinafter specified in the business of the Company and to make
provision for payment of reasonable compensation to the Executive for such
services and the Executive is willing to be employed by the Company to perform
the duties incident to such employment upon the terms and conditions hereinafter
set forth and thus to forego opportunities elsewhere; and
WHEREAS, in conjunction with entering into the Severance Protection
Agreement (the "Severance Protection Agreement"), the Non-Competition Agreement
(the "Non-Competition Agreement") and the Employee Agreement (the "Employee
Agreement"), which are attached hereto as Exhibits A, B and C, respectively, the
parties also desire to enter into this Agreement, as of the Effective Date,
setting forth the terms and conditions of the employment relationship of the
Executive with the Company during the Term (as hereinafter defined).
NOW THEREFORE, in consideration of the promises and the mutual
covenants herein contained, the parties hereby agree as follows:
1. Employment; Duties.
(a) Employment. The Company hereby agrees to employ the Executive,
and the Executive hereby agrees to serve, as Chief Executive Officer and
President of the Company. The Executive will also be nominated to stand for
election to the Board of Directors of the Company (the "Board") and, as a member
of the Board, will be appointed to the Board's Finance and Corporate Development
Committee and the Executive Committee. As Chief Executive Officer and President
of the Company, the Executive will be invited to attend meetings of all other
Board Committees, it being understood that such Board Committees may excuse the
Executive from attending such meetings to the extent necessary for such Board
Committees to act consistently with their fiduciary obligations. Notwithstanding
the foregoing, the Executive's employment hereunder is contingent upon (i) a
satisfactory test for the use of drugs, (ii) evidence of eligibility to be
employed in the United States and (iii) entering into the Severance Protection
Agreement, the Non-Competition Agreement and the Employee Agreement.
(b) Duties. As Chief Executive Officer and President of the Company
and a member of the Board, the Executive will have full authority to act on
behalf of the Company in a manner that is consistent with his title and
position. In such capacity, the Executive also agrees to perform such duties and
exercise such powers commensurate with his office as may from time
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to time be reasonably requested of him by the Board or vested in him by the
bylaws of the Company. The Executive shall report exclusively to the Board.
During the Term, the Executive shall:
(1) have responsibility to manage the day-to-day business affairs
and operations of the Company (subject to the discretion and authority of
the Board and the customary policies and practices of the Company, its
subsidiaries and its affiliates); and
(2) devote substantially all of his full working time, attention,
abilities and efforts to the performance of his employment with the
Company (including its subsidiaries or affiliates, when so required).
To the extent such service does not interfere with the performance
of his duties as an employee and Board member, (i) during the Term, the
Executive may continue to serve as a member of the Board of Directors of
Xxxxxxxx'x International, Inc. of which he is currently a member, (ii) after the
first anniversary of the Term, he may serve as a member of the board of
directors of one additional company other than the Company, subject to the
approval the Board (which approval shall not be unreasonably withheld) and (iii)
at any time, he may serve on civic or charitable boards.
(c) Principal Place of Employment. The Executive's principal place
of employment will be the Company's World Headquarters in Camden, New Jersey.
2. Term. The term (the "Term") of the Executive's employment
hereunder shall be for a period of five (5) years commencing on the Effective
Date and (unless earlier terminated in accordance with Section 4(a) below or as
otherwise extended by the mutual agreement of the parties) ending on the fifth
anniversary thereof.
3. Compensation. Subject to the terms of this Agreement and until
the end of the Term, the Company shall pay compensation and provide benefits to
the Executive as follows:
(a) Base Salary. The Company shall pay to the Executive a base
salary of $900,000 per annum during the Term ("Base Salary"). The Executive
shall receive his Base Salary in equal semi-monthly installments (or in such
other equal installments in accordance with the Company's payroll practices in
effect from time to time). The Executive shall be eligible for annual Base
Salary increases as the Board may approve in its discretion.
(b) Annual Bonus. Beginning for the Company's Fiscal Year (as
defined below) 2001 and for each other Fiscal Year of the Company that begins
during the Term, the Company may pay a bonus (the "Bonus") to the Executive as
determined by the Board in accordance with the Company's Management Worldwide
Incentive Plan (the "Bonus Plan"). The Company's fiscal year commences on the
Monday following the Sunday that is nearest to July 31st of each year and ends
the Sunday that is nearest to July 31st of the next year (the "Fiscal Year").
Annual performance goals and annual bonus targets will be determined by the
Compensation and Organization Committee of the Board (the "Compensation
Committee") in accordance with the terms of the Bonus Plan; provided, however,
that the annual bonus target for Fiscal Year 2001 shall be $1,650,000 and the
minimum guarantee for Fiscal Year 2001 shall be the target amount, pro rated for
the period of active employment during such Fiscal Year;
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provided, further, to the extent that the payment of such Bonus would result in
a loss of deduction to the Company pursuant to Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code"), such Bonus amounts will be
deferred under the Company's Deferred Compensation Plan (the "Deferred
Compensation Plan") and deemed invested in stock units of the Company which
would become payable at such time provided under the Deferred Compensation Plan
as long as the Code Section 162(m) limitation is not applicable at the time of
such payment. Notwithstanding the foregoing, there is no maximum limit on the
Bonus that could be earned for Fiscal Year 2001, subject to the terms of the
Bonus Plan. The maximum limit, if any, on the Bonus for Fiscal Years commencing
after 2001 will be determined by the Compensation Committee, subject to the
terms of the Bonus Plan, and will be consistent with the maximum limit
applicable to other similarly situated senior executives.
(c) Initial Equity Awards. On the Effective Date, the Company shall
grant the Executive options to purchase 1,000,000 shares (the "Initial Option
Grant") of the Company's common stock, par value of $0.0375 per share (the
"Common Stock"), pursuant to and subject to the terms and conditions of the
Company's 1994 Long-Term Incentive Plan (the "Plan"). The Initial Option Grant
will have a term of ten years commencing on the Effective Date and will vest at
a rate of 30% on the first and second anniversaries of the Effective Date with
the remaining 40% vesting on the third anniversary of the Effective Date and
will be documented in the form attached hereto as Exhibit D.
(d) Future Equity Grants.
(i) Stock Options. In addition to the Initial Option Grant, the
Executive will be eligible to receive an annual award of stock options
under the Plan. With respect to the grant of stock options which will be
awarded in June or July, 2001, the Executive will be awarded options with
a Black-Scholes value of not less than $4,125,000, based on a calculation
using the Company's standard Black-Scholes valuation model. Stock options
granted under this Section 3(d)(i) will have a term of ten years
commencing on the date of grant and will vest at a rate of 30% on the
first and second anniversaries of the date of grant with the remaining 40%
vesting on the third anniversary of the date of grant.
(ii) Restricted Performance Shares. The Executive will be eligible
to receive grants of restricted performance shares under the Plan. In June
or July, 2001, the Company shall grant to the Executive restricted
performance shares equal in value to at least $8,250,000 pursuant to and
subject to the terms and conditions of the Plan and any restricted
performance share agreement entered into by the Executive and the Company,
for the performance period commencing in Fiscal Year 2002 and ending in
Fiscal Year 2004. Restricted performance shares earned may vary from 0% to
200% of the initial restricted performance share grant. Performance goals
and targets for the performance period shall be determined by the
Compensation Committee pursuant to and subject to the terms and conditions
of the Plan and shall be consistent with those applicable to other
similarly situated senior executives.
(iii) Other Equity Awards. Any other equity awards, including future
grants of stock options or restricted performance shares, will be granted
to the Executive on a basis generally consistent with, and no less
favorable than, awards to other similarly situated
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senior executives of the Company, in such amounts and on such terms and
conditions as may be established by the Board and the Compensation
Committee pursuant to the Plan.
(e) Benefit Continuation and Perquisites. Except as set forth below
in clauses (i), (ii) and (iii), the Executive shall participate during the Term
in such other employee benefit plans and programs as may be maintained from time
to time during the Term, on a no less favorable basis than available to other
similarly situated senior executives of the Company and subject to the terms and
provisions of such plans or programs.
(i) Pension. The amount of the Executive's pension and his
eligibility for such pension will be determined pursuant to the provisions
of the Company's Mid-Career Hire Pension Plan (the "Mid-Career Pension
Plan"), except that the Executive will be required to complete three,
rather than five, years of active employment with the Company in order to
become eligible for a pension benefit under the Mid-Career Pension Plan.
(ii) Supplemental Disability. The Executive shall be eligible for
Company-paid long-term disability coverage of up to 50% of his Base Salary
and additional coverage up to 65% of his Base Salary at his own expense.
(iii) Fringes and Perquisites. The Executive will be entitled to a
$48,000 annual allowance for an automobile, clubs and other perquisites.
(f) Deferred Compensation Plan. The Executive will be eligible to
defer compensation pursuant to the terms of the Deferred Compensation Plan.
(g) Vacation. The Executive shall be entitled to four weeks (but not
necessarily consecutive vacation weeks) of paid vacation for the 2001 calendar
year, and to paid vacation for each year thereafter during the Term in
accordance with the Company's policy (but in no event less than four weeks per
year).
(h) Reimbursement of Expenses. The Company shall reimburse the
Executive for all reasonable business expenses incurred personally by him on
behalf of the Company in accordance with the policies and procedures applicable
to other similarly situated senior executives of the Company, which shall
include reasonable legal fees not to exceed $50,000 for representation in
connection with his employment with the Company.
(i) Temporary Living Expenses. From January, 2001 through the
earlier of June, 2002 or his relocation to permanent housing, the Executive will
be reimbursed for reasonable living expenses in the Philadelphia area, including
apartment and furniture rental, and will be provided with a car and driver on an
as-needed basis, the expenses of which will be in addition to the perquisite
allowance provided in Section 3(e)(iii) above. In the event any reimbursement of
these expenses results in a tax to the Executive, such reimbursement shall be
provided on a tax grossed-up basis.
(j) Relocation Expenses. The Executive will be entitled to
reasonable relocation expenses in accordance with the Company's Relocation
Policy for New Hires. In the
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event any reimbursement of these expenses results in a tax to the Executive,
such reimbursement shall be provided on a tax grossed-up basis.
4. Termination and Definitions.
(a) Earlier Termination of Term. Notwithstanding the provisions of
Section 2, the Executive's employment with the Company may be terminated by the
Board or the Executive may resign such employment prior to the expiration of the
Term as follows:
(i) the Company may terminate the Executive's employment hereunder
for Cause (as defined hereunder), provided that the Company complies with
the provisions of Section 5(a);
(ii) the Company may terminate the Executive's employment hereunder
without Cause, provided that the Company complies with the provisions of
Section 5(b);
(iii) the Company may terminate the Executive's employment hereunder
upon the Executive's Disability, provided that the Company complies with
the provisions of Section 5(a);
(iv) the Executive's employment hereunder shall terminate
automatically upon his death in which event the Company shall comply with
provisions of Section 5(a); or
(v) the Executive may voluntarily resign from employment with the
Company in which event the Company shall comply with provisions of Section
5(a). The Executive's Voluntary Resignation (as hereinafter defined) shall
not be a breach of this Agreement.
(b) Notice of Termination. Any purported termination of the
Executive's employment by the Board or resignation by the Executive, other than
a termination due to death, shall be communicated by written Notice of
Termination to the other party in accordance with Section 9. For purposes of
this Agreement, a "Notice of Termination" shall mean a notice which indicates
the specific termination provision in this Agreement relied upon and shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive's employment under the provision so
indicated. For purposes of this Agreement, no such purported termination or
resignation shall be effective without such Notice of Termination.
(c) Definition "Termination Date". "Termination Date" shall mean, in
the case of the Executive's death, his date of death and, in all other cases,
the date specified in the Notice of Termination, provided that, if the
Executive's employment is terminated by the Company due to Disability (as
defined below), the date specified in the Notice of Termination shall be at
least thirty (30) days from the date the Notice of Termination is given to the
Executive, provided that in the case of Disability the Executive shall not have
returned to the full-time performance of his duties during such period of at
least thirty (30) days.
(d) Definition of "Cause". As used herein, "Cause" shall mean,
during the Term of this Agreement, a termination evidenced by a resolution
adopted in good faith by two-thirds of the Board that the Executive:
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(i) intentionally and continually failed to substantially perform
his duties with the Company (other than a failure resulting from the
Executive's incapacity due to physical or mental illness) which failure
continued for a period of at least thirty (30) days after a written notice
of demand for substantial performance has been delivered to the Executive
specifying the manner in which the Executive has failed to substantially
perform: or
(ii) intentionally engaged in conduct which is demonstrably and
materially injurious to the Company, monetarily or otherwise; provided,
however, that no termination of the Executive's employment shall be for
Cause as set forth in this clause (ii) until (x) there shall have been
delivered to the Executive a copy of a written notice setting forth that
the Executive was guilty of the conduct set forth in this clause (ii) and
specifying the particulars thereof in detail and (y) the Executive shall
have been provided an opportunity to be heard by the Board (with the
assistance of the Executive's counsel if the Executive so desires). No
act, or failure to act, under either clause (i) or (ii) on the Executive's
part shall be considered "intentional" unless he has acted, or failed to
act, with an absence of good faith and without a reasonable belief that
his action or failure to act was in the best interest of the Company.
Notwithstanding anything contained in this Agreement to the contrary, no
failure to perform by the Executive after a Notice of Termination is given
by the Executive shall constitute Cause for purposes of this Agreement.
To the extent that any of the Company's employee benefit plans or
programs that are applicable to the Executive (other than the Severance
Protection Agreement) provide for a definition of Cause, such definition shall
not apply and the definition of Cause provided for in this Section 4(d) shall
govern.
(e) Definition of "Disability". Disability means a physical or
mental infirmity that impairs the Executive's ability to substantially perform
his duties under this Agreement for a continuous period of one hundred eighty
(180) days. Any question as to the existence of an Executive's Disability upon
which the Executive and the Company cannot agree will be determined by a
qualified independent physician selected by the Executive and the Company. If
the Company and the Executive cannot agree on a physician, the Chief of Staff of
Xxxxxx Xxxxxxxxx Hospital in Philadelphia, Pennsylvania shall select a
physician. The determination of such physician made in writing to the Company
and to the Executive shall be final and conclusive for all purposes of this
Agreement.
5. Severance and Benefits.
(a) Termination for Cause, Disability, Death or Voluntary
Resignation. If the Executive's employment with the Company shall be terminated
(1) by the Company for Cause or Disability, (2) by reason of the Executive's
death, or (3) the Executive voluntarily resigns his employment with the Company
for any reason ("Voluntary Resignation"), the Company shall pay the Executive
all amounts earned or accrued through the Termination Date but not paid as of
the Termination Date, including (i) Base Salary, (ii) reimbursement for
reasonable and necessary expenses incurred by the Executive on behalf of the
Company during the period ending on the Termination Date, and (iii) vacation pay
(collectively, "Accrued
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Compensation"). In addition, in the event the Executive's employment terminates
due to death or Disability, the Company shall also (i) pay the Executive or his
beneficiary the Pro-Rata Bonus (as defined below), (ii) for twelve months
following such Termination Date, continue at its expense on behalf of the
Executive and his dependents and beneficiaries the life insurance and medical
benefits provided (x) to the Executive at any time during the 90-day period
prior to the Termination Date or (y) to other similarly situated senior
executives who continue in the employ of the Company, provided further that in
the event the Executive's employment terminates due to Disability, the Company's
obligation hereunder with respect to the foregoing benefits shall be limited to
the extent that the Executive obtains any such benefits pursuant to a subsequent
employer's benefit plans, in which case the Company may reduce the coverage of
any benefits it is required to provide the Executive hereunder as long as the
aggregate coverages and benefits of the combined benefit plans are no less
favorable to the Executive than the coverages and benefits required to be
provided hereunder; and (iii) provide that any outstanding vested stock options
will remain exercisable in accordance with the terms of the Plan at the time of
grant and restricted performance shares will vest in accordance with the
Company's policy at the time of grant. In the event of a Voluntary Resignation,
in addition to any Accrued Compensation, his outstanding stock options may be
exercised to the extent they are vested as of the Termination Date in accordance
with the terms of the Plan at the date of grant.
(b) Termination of Employment Without Cause. If the Executive's
employment with the Company shall be terminated by the Company other than for
Cause, Disability, by reason of death or due to a Voluntary Resignation by the
Executive, the Executive shall be entitled to the following:
(i) the Company shall pay the Executive all Accrued Compensation and
a pro-rata portion of the Bonus for the Fiscal Year in which termination
of employment occurs based on the portion of such Fiscal Year that has
elapsed prior to the Termination Date, provided that the Executive has
been employed by the Company for at least three months of such Fiscal
Year, and provided further that payment of the Pro-Rata Bonus will be
determined following the close of such Fiscal Year and certification of
performance by the Compensation Committee (the "Pro-Rata Bonus");
(ii) the Company shall pay the Executive as severance pay and in
lieu of any further compensation for periods subsequent to the Termination
Date in installment payments over a 24-month period in cash (the
"Severance Amount") equal to two times the Executive's annual highest Base
Salary in effect during the 90-day period prior to the Termination Date;
(iii) for a number of months equal to the lesser of (A) 24 and (B)
the number of months remaining until the Executive's 65th birthday (the
"Continuation Period"), the Company shall at its expense continue on
behalf of the Executive and his dependents and beneficiaries the life
insurance and medical benefits provided (x) to the Executive at any time
during the 90-day period prior to the Termination Date or (y) to other
similarly situated senior executives who continue in the employ of the
Company during the Continuation Period. The coverage and benefits
(including deductibles and costs) provided in this Section 5(b)(iii)
during the Continuation Period shall be no less favorable to the Executive
and his dependents and beneficiaries than the most favorable of such
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coverages and benefits during any of the periods referred to in clauses
(x) and (y) above. The Company's obligation hereunder with respect to the
foregoing benefits shall be limited to the extent that the Executive
obtains any such benefits pursuant to a subsequent employer's benefit
plans, in which case the Company may reduce the coverage of any benefits
it is required to provide the Executive hereunder as long as the aggregate
coverages and benefits of the combined benefit plans are no less favorable
to the Executive than the coverages and benefits required to be provided
hereunder;
(iv) notwithstanding any provision of the Mid-Career Pension Plan to
the contrary, as long as the Executive has completed at least three years
of active employment with the Company as of the Termination Date, the
Company shall credit the Executive with additional credited service for
purposes of benefit accruals under the Mid-Career Pension Plan equal to
the lesser of (A) 24 months and (B) the number of months remaining until
the Executive's 65th birthday for purposes of determining the Executive's
annual pension under the Company's Mid-Career Pension Plan;
(v) any outstanding stock options that are vested as of the
Termination Date may be exercised by the Executive in accordance with the
terms of the Plan at the time of grant; and
(vi) any outstanding restricted performance shares as of the
Termination Date shall partially vest as of the Termination Date based on
the portion of the performance period that has elapsed as of the
Termination Date, provided that the Executive has been employed by the
Company for at least one (1) year of the respective performance periods of
such awards; and provided further that the restrictions on such shares
shall remain through the end of the respective performance periods and
certification of the performance by the Compensation Committee.
(c) The Executive shall not be required to mitigate the amount of
any payment provided for in this Agreement by seeking other employment or
otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Executive in any subsequent employment
except as provided in Sections 5(a) and (b)(iii) with respect to the
continuation of certain welfare benefits provided therein.
(d) No payment will be made under this Section 5 unless (a) the
Executive first executes a standard release form substantially in the form
attached hereto as Exhibit E and (b) to the extent any portion of such release
is subject to the seven-day revocation period prescribed by the Age
Discrimination in Employment Act, as amended, or to any similar revocation
period in effect on the Termination Date, such revocation period has expired.
6. Indemnification.
(a) The Company agrees to indemnify, defend and hold harmless the
Executive from and against any and all liabilities to which he may be subject as
a result of his employment hereunder (as a result of his service as an officer
or director of the Company or as an officer or director of any of its
subsidiaries or affiliates), as well as the costs, including attorneys' and
other professional fees and disbursements, of any legal action brought or
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threatened against him as a result of such employment in accordance with the
By-Laws and indemnification policies of the Company, to the fullest extent
permitted by, and subject to the limitations of, applicable corporate law.
(b) Neither the failure of the Company (including its Board, any
Committee thereof, independent legal counsel or stockholders) to have made a
determination prior to the commencement of any proceeding concerning payment of
amounts claimed by the Executive under Section 6(a) above that indemnification
of the Executive is proper because he has met the applicable standard of
conduct, nor a determination by the Company (including its Board, any Committee
thereof, independent legal counsel or stockholders) that the Executive has not
met such applicable standard of conduct, shall create a presumption that the
Executive has not met the applicable standard of conduct.
(c) To the extent that the Company maintains D&O liability insurance
coverage, such coverage shall be applicable to the Executive in the same manner
as applicable to other similarly situated senior executives.
7. Successors; Binding Agreement.
(a) This Agreement shall be binding upon and shall inure to the
benefit of the Company, its successors and assigns. Rights or obligations of the
Company under this Agreement may be assigned or transferred by the Company
pursuant to a merger or consolidation in which the Company is not the continuing
entity, or the sale or liquidation of all or substantially all of the assets of
the Company, provided that the assignee or transferee is the successor to all or
substantially all of the assets of the Company and such assignee or transferee
assumes the liabilities, obligations and duties of the Company, as contained in
this Agreement, either contractually or as a matter of law. The Company further
agrees that, in the event of a sale of assets or liquidation as described in the
preceding sentence, it shall take whatever action it reasonably can in order to
cause such assignee or transferee to expressly assume the liabilities,
obligations and duties of the Company hereunder. The term the "Company" as used
herein shall include such successors and assigns. The term "successors and
assigns" as used herein shall mean a corporation or other entity acquiring all
or substantially all the assets and business of the Company (including this
Agreement) whether by operation of law or otherwise.
(b) Neither this Agreement nor any right or interest hereunder shall
be assignable or transferable by the Executive, his beneficiaries or legal
representatives, except by will or by the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal personal representative.
8. Withholding. The Company shall be authorized to withhold from any
award or payment it makes under this Agreement the amount of withholding taxes
due with respect to such award or payment and to take such other action as may
be necessary in the opinion of the Company to satisfy all obligations for the
payment of such taxes.
9. Notice. For the purposes of this Agreement, notices and all other
communications provided for in this Agreement (including the Notice of
Termination) shall be in writing and shall be deemed to have been duly given (a)
when personally delivered, or (b) sent
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by certified mail, return receipt requested, postage prepaid or (c) by
nationally recognized overnight courier, in all cases, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications shall be
deemed to have been received on the date of delivery thereof in the case of (a)
and (c) or on the third business day after the mailing thereof in the case of
(b), except that notice of change of address shall be effective only upon
receipt.
10. Non-exclusivity of Rights. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in, or
entitlements under, any benefit, bonus, incentive or other plan or program
provided by the Company or any of its subsidiaries and for which the Executive
may qualify, nor shall anything herein limit or reduce such rights as the
Executive may have under any other agreements with the Company or any of its
subsidiaries; provided, however, to the extent that the Executive receives
benefits and payments under this Agreement and it is determined that the
provisions of the Severance Protection Agreement relating to a termination in
anticipation of a Change in Control (as defined in the Severance Protection
Agreement) are applicable, he shall be entitled to benefits and payments under
the Severance Protection Agreement if such benefits and payments are greater
than the benefits and payments under this Agreement, but in no event shall he be
entitled to duplicative benefits and payments. Amounts which are vested benefits
or which the Executive is otherwise entitled to receive under any plan or
program of the Company or any of its subsidiaries shall be payable in accordance
with such plan or program.
11. Representations.
(a) Executive's Representations. The Executive hereby represents and
warrants that (i) entering into this Agreement and performing his duties
hereunder would not violate or breach the terms and conditions of any oral or
written agreements or understandings that the Executive is bound by in
connection with his previous employers; (ii) to the best of his knowledge and
belief, delivery and performance of this Agreement by him does not violate any
applicable law, regulation, order, judgment or decree by which he is bound, and
(iii) upon the execution and delivery of this Agreement by the Executive and the
Company, this Agreement shall be a valid and binding obligation of the
Executive, enforceable against him in accordance with its terms, except to the
extent that enforceability may be limited by applicable bankruptcy, insolvency
or similar laws affecting the enforcement of creditors' rights generally.
(b) Company's Representations. The Company represents and warrants
that (i) it is fully authorized by action of its Board to enter into this
Agreement and to perform its obligations under it; (ii) to the best of the
Company's knowledge and belief, the execution, delivery and performance of this
Agreement by it will not violate any applicable law, regulation, order, judgment
or decree or any agreement, plan or corporate governance document to which it is
a party or by which it is bound; and (iii) upon the execution and delivery of
this Agreement by the Executive and the Company, this Agreement shall be a valid
and binding obligation of the Company, enforceable against it in accordance with
its terms, except to the extent that enforceability may be limited by applicable
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally.
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12. Miscellaneous. No provision of this Agreement may be amended,
modified, waived or discharged unless such amendment, waiver, modification or
discharge is agreed to in writing and signed by the Executive and the Company.
No waiver by either party hereto at any time of any breach by the other party
hereto of, or compliance with, any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time. No agreement or representations, oral or otherwise, express or implied,
with respect to the subject matter hereof have been made by either party which
are not expressly set forth in this Agreement.
13. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of New Jersey, without
reference to the principles of conflicts of laws. Each party hereto consents to
in personam jurisdiction and venue in the United States District Court of New
Jersey. In the event that the United States District Court of New Jersey should
lack subject matter jurisdiction, the parties consent to jurisdiction and venue
in a court of competent jurisdiction in Camden County in the State of New
Jersey.
14. Severability. The provisions of this Agreement shall be deemed
severable, and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
15. Rules of Construction. The captions in this Agreement are for
convenience of reference only and in no way define, limit or describe the scope
or intent of any provisions or Sections of this Agreement. All references in
this Agreement to particular Sections are references to the Sections of this
Agreement, unless some other reference is clearly indicated.
16. Execution. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same agreement.
17. Headings. The headings contained in this Agreement are intended
solely for convenience and shall not control or affect the meaning or
construction of the provisions of this Agreement.
18. Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements, if any, understandings and arrangements,
oral or written, between the parties hereto with respect to such subject matter,
except for the Severance Protection Agreement (in the event of a Change in
Control (as defined in the Severance Protection Agreement)), the Non-Competition
Agreement and the Employee Agreement, in each case executed as of the date
hereof. In addition to the foregoing, to the extent the Executive breaches any
of the terms and conditions of the Severance Protection Agreement, the
Non-Competition Agreement or Employee Agreement, such breach or violation shall
also be considered to be a breach or violation of this Agreement.
19. Survivability. Except as otherwise expressly set forth in this
Agreement, the respective rights and obligations of the parties hereunder shall
survive any termination of the
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Executive's employment. This Agreement itself (as distinguished from the
Executive's employment) may not be terminated by either party without the
written consent of the other party.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized officer and the Executive has executed this
Agreement as of the date and year first above written.
XXXXXXXX SOUP COMPANY
ATTEST: BY:/s/ Xxxxxx X. Xxxxxxxxxx
------------------------
Title: Chairman of the Board
of Directors
/s/Xxxx X. Xxxxx
-------------------
Corporate Secretary
BY:/s/ Xxxxxxx X. Xxxxxx
---------------------
Xxxxxxx X. Xxxxxx
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EXHIBIT A
SEVERANCE PROTECTION AGREEMENT
THIS AGREEMENT made as of January 8, 2001, by and between
Xxxxxxxx Soup Company (the "Company") and Xxxxxxx X. Xxxxxx (the "Executive").
WHEREAS, the Board of Directors of the Company (the "Board")
recognizes that the possibility of a Change in Control (as hereinafter defined)
exists and that the threat of or the occurrence of a Change in Control may
result in the departure or in significant distractions of its key management
personnel because of the uncertainties inherent in such a situation;
WHEREAS, the Board has, as recommended and approved by the
Compensation and Organization Committee (the "Committee"), determined that it is
essential and in the best interest of the Company and its stockholders to retain
the services of the Executive in the event of a threat or occurrence of a Change
in Control and to ensure his continued dedication and efforts in such event
without undue concern for his personal financial and employment security; and
WHEREAS, in order to induce the Executive to remain in the
employ of the Company and to encourage the continued attention and dedication of
the Executive, particularly in the event of a threat or the occurrence of a
Change in Control, the Company desires to enter into this Agreement with the
Executive to provide the Executive with certain benefits in the event his
employment is terminated as a result of, or in connection with, a Change in
Control.
NOW, THEREFORE, in consideration of the respective agreements
of the parties contained herein, it is agreed as follows:
1. Term of Agreement. The term of this Agreement (the
"Term") shall commence on January 8, 2001, and shall continue in effect until
the third anniversary of such date; provided, however, that commencing on the
second anniversary of such date and on each anniversary thereafter, the term of
this Agreement shall automatically be extended for one (1) year unless either
the Company or the Executive shall have given written notice to the other at
least ninety (90) days prior thereto that the term of this Agreement shall not
be so extended; and provided, further, however, that notwithstanding any such
notice by the Company not to extend, the Term shall not expire prior to the
expiration of twenty-four (24) months after the occurrence of a Change in
Control.
2. Definitions.
2.1 "Cause" means a termination evidenced by a resolution
adopted in good faith by no less than two-thirds of the Board that the Executive
(a) intentionally and continually failed to substantially perform his duties
with the Company (other than a failure resulting from the Executive's incapacity
due to physical or mental illness) which failure continued for a period of at
least thirty (30) days after a written notice of demand for substantial
performance has been delivered to the Executive specifying the manner in which
the Executive has failed to substantially perform, or (b) intentionally engaged
in conduct which is demonstrably and
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materially injurious to the Company, monetarily or otherwise; provided, however,
that no termination of the Executive's employment shall be for Cause as set
forth in clause (b) above until (x) there shall have been delivered to the
Executive a copy of a written notice setting forth that the Executive was guilty
of the conduct set forth in clause (b) and specifying the particulars thereof in
detail, and (y) the Executive shall have been provided an opportunity to be
heard by the Board (with the assistance of the Executive's counsel if the
Executive so desires). No act, nor failure to act, on the Executive's part,
shall be considered "intentional" unless he has acted, or failed to act, with an
absence of good faith and without a reasonable belief that his action or failure
to act was in the best interest of the Company. Notwithstanding anything
contained in this Agreement to the contrary, no failure to perform by the
Executive after a Notice of Termination is given by the Executive shall
constitute Cause for purposes of this Agreement.
2.2 "Change in Control" means any of the following
events: (a) The acquisition in one or more transactions by any "Person" (as the
term person is used for purposes of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended (the "1934 Act") of "Beneficial Ownership"
(within the meaning of Rule 13d-3 promulgated under the 0000 Xxx) of twenty-five
percent (25%) or more of the combined voting power of the Company's then
outstanding voting securities (the "Voting Securities"), provided, however, that
for purposes of this Section 2.2(a), the Voting Securities acquired directly
from the Company by any Person shall be excluded from the determination of such
Person's Beneficial Ownership of Voting Securities (but such Voting Securities
shall be included in the calculation of the total number of Voting Securities
then outstanding); or
(b) The individuals who, as of September 28, 2000, are
members of the Board (the "Incumbent Board"), cease for any reason to constitute
more than fifty percent (50%) of the Board; provided, however, that if the
election, or nomination for election by the Company's stockholders, of any new
director was approved by a vote of at least two-thirds of the Incumbent Board,
such new director shall, for purposes of this Agreement, be considered as a
member of the Incumbent Board; or
(c) Approval by stockholders of the Company of (1) a
merger or consolidation involving the Company if the stockholders of the
Company, immediately before such merger or consolidation, do not own, directly
or indirectly immediately following such merger or consolidation, more than
fifty percent (50%) of the combined voting power of the outstanding Voting
Securities of the corporation resulting from such merger or consolidation in
substantially the same proportion as their ownership of the Voting Securities
immediately before such merger or consolidation or (2) a complete liquidation or
dissolution of the Company or an agreement for the sale or other disposition of
all or substantially all of the assets of the Company; or
(d) Acceptance of stockholders of the Company of shares
in a share exchange if the stockholders of the Company, immediately before such
share exchange, do not own, directly or indirectly immediately following such
share exchange, more than fifty percent (50%) of the combined voting power of
the outstanding Voting Securities of the corporation resulting from such share
exchange in substantially the same proportion as their ownership of the Voting
Securities outstanding immediately before such share exchange.
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Notwithstanding the foregoing, a Change in Control shall not
be deemed to occur solely because twenty-five percent (25%) or more of the then
outstanding Voting Securities is acquired by (i) a trustee or other fiduciary
holding securities under one or more employee benefit plans maintained by the
Company or any of its subsidiaries, (ii) any corporation which, immediately
prior to such acquisition, is owned directly or indirectly by the stockholders
of the Company in the same proportion as their ownership of stock in the Company
immediately prior to such acquisition, (iii) any "Grandfathered Xxxxxxxx Family
Stockholder" (as hereinafter defined) or (iv) any Person who has acquired such
Voting Securities directly from any Grandfathered Xxxxxxxx Family Stockholder
but only if such Person has executed an agreement which is approved by
two-thirds of the Board and pursuant to which such Person has agreed that she
(or they) will not increase her (or their) Beneficial Ownership (directly or
indirectly) to 30% or more of the outstanding Voting Securities (the "Standstill
Agreement") and only for the period during which the Standstill Agreement is
effective and fully honored by such Person.
For purposes of this Section, "Grandfathered Xxxxxxxx Family
Stockholder" shall mean at any time a "Xxxxxxxx Family Stockholder" (as
hereinafter defined) who or which is at the time in question the Beneficial
Owner solely of (v) Voting Securities Beneficially Owned by such individual on
January 25, 1990, (w) Voting Securities acquired directly from the Company, (x)
Voting Securities acquired directly from another Grandfathered Xxxxxxxx Family
Stockholder, (y) Voting Securities which are also Beneficially Owned by other
Grandfathered Xxxxxxxx Family Stockholders at the time in question, and (z)
Voting Securities acquired after January 25, 1990 other than directly from the
Company or from another Grandfathered Xxxxxxxx Family Stockholder by any
"Xxxxxxxx Grandchild" (as hereinafter defined), provided that the aggregate
amount of Voting Securities so acquired by each such Xxxxxxxx Grandchild shall
not exceed five percent (5%) of the Voting Securities outstanding at the time of
such acquisition.
A "Xxxxxxxx Family Stockholder" who or which is at the time in
question the Beneficial Owner of Voting Securities which are not specified in
clauses (v), (w), (x), (y) and (z) of the immediately preceding sentence shall
not be a Grandfathered Xxxxxxxx Family Stockholder at the time in question. For
purposes of this Section, "Xxxxxxxx Family Stockholders" shall mean individuals
who are descendants of the late Xx. Xxxx X. Xxxxxxxx, Xx. and/or the spouses,
fiduciaries and foundations of such descendants. A "Xxxxxxxx Grandchild" means
as to each particular grandchild of the late Xx. Xxxx X. Xxxxxxxx, Xx., all of
the following taken collectively: such grandchild, such grandchild's descendants
and/or the spouses, fiduciaries and foundations of such grandchild and such
grandchild's descendants.
Moreover, notwithstanding the foregoing, a Change in Control
shall not be deemed to occur solely because any Person (the "Subject Person")
acquired Beneficial Ownership of more than the permitted amount of the
outstanding Voting Securities as a result of the acquisition of Voting
Securities by the Company which, by reducing the number of Voting Securities
outstanding, increases the proportional number of shares Beneficially Owned by
the Subject Person, provided that if a Change in Control would occur (but for
the operation of this sentence) as a result of the acquisition of Voting
Securities by the Company, and after such share acquisition by the Company, the
Subject Person becomes the Beneficial Owner of any additional Voting Securities
which increases the percentage of the then outstanding Voting Securities
Beneficially Owned by the Subject Person, then a Change in Control shall occur.
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(e) Notwithstanding anything contained in this Agreement
to the contrary, if the Executive's employment is terminated by the Company
without Cause within one year prior to a Change in Control and the Executive
reasonably demonstrates that such termination (1) was at the request of a Third
Party (as defined in Section 2.4(b)) who effectuates a Change in Control or (2)
otherwise occurred in connection with or in anticipation of, a Change in
Control, then, for all purposes of this Agreement, the date of a Change in
Control shall mean the date immediately prior to the date of such Executive's
termination of employment.
2.3 "Disability" means a physical or mental infirmity
that impairs the Executive's ability to substantially perform his duties under
this Agreement for a continuous period of one hundred eighty (180) days. Any
question as to the existence of an Executive's Disability upon which the
Executive and the Company cannot agree will be determined by a qualified
independent physician selected by the Executive and the Company. If the Company
and the Executive cannot agree on a physician, the Chief of Staff of Xxxxxx
Xxxxxxxxx Hospital in Philadelphia, Pennsylvania shall select a physician. The
determination of such physician made in writing to the Company and to the
Executive shall be final and conclusive for all purposes of this Agreement.
2.4 (a) "Good Reason" means the occurrence after a Change
in Control of any of the events or conditions described in subsections (1)
through (7) hereof:
(1) a change in the Executive's position or
responsibilities (including reporting responsibilities) which
represents a material adverse change from his position or
responsibilities as in effect immediately prior to such Change
in Control; the assignment to the Executive of any duties or
responsibilities which, in the Executive's reasonable
judgment, are inconsistent with his status, position or
responsibilities; or any removal of the Executive from or
failure to reappoint or reelect the Executive to any of such
offices or positions, except in connection with the
termination of his employment for Disability, Cause, death or
by the Executive other than for Good Reason;
(2) a reduction in the Executive's base salary
or any failure to pay the Executive any compensation or
benefits to which he is entitled within thirty (30) days of
the date due;
(3) the Company's requiring the Executive to be
based at any place outside a 50-mile radius from his principal
place of employment immediately prior to such Change in
Control, except for reasonably required travel on the
Company's business which is not greater than such travel
requirements prior to the Change in Control;
(4) the failure by the Company to (A) continue
in effect (without reduction in benefit level, and/or reward
opportunities) any compensation or employee benefit plan in
which the Executive was participating immediately prior to the
Change in Control, unless a substitute or replacement plan has
been implemented which provides substantially identical
compensation or benefits to the Executive or (B) provide the
Executive with compensation and benefits, in the
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aggregate, at least equal (in terms of benefit levels and/or
reward opportunities) to those provided for under each other
compensation or employee benefit plan, program and practice as
in effect immediately prior to the Change in Control (or as in
effect following the Change in Control, if greater);
(5) any material breach by the Company of any
provision of this Agreement;
(6) any purported termination of the Executive's
employment for Cause by the Company which does not comply with
the terms of Section 2.1; or
(7) the failure of the Company to obtain an
agreement, satisfactory to the Executive, from any successor
or assign of the Company to assume and agree to perform this
Agreement, as contemplated in Section 8 hereof.
(b) Any event or condition described in Section 2.4(a)(1)
through (7) which occurs prior to a Change in Control but which the Executive
reasonably demonstrates (1) was at the request of a third party who has
indicated an intention or taken steps reasonably calculated to effect a Change
in Control (a "Third Party"), or (2) otherwise arose in connection with or in
anticipation of a Change in Control, shall constitute Good Reason for purposes
of this Agreement notwithstanding that it occurred prior to the Change in
Control.
(c) The Executive's right to terminate his employment
pursuant to this Section 2.4 shall not be affected by his incapacity due to
physical or mental illness.
3. Severance and Benefits.
3.1 If, during the Term, the Executive's employment with
the Company is terminated within twenty-four (24) months following a Change in
Control, the Executive shall be entitled to the following compensation and
benefits:
(a) If the Executive's employment with the Company is
terminated (1) by the Company for Cause or Disability, (2) by reason of the
Executive's death, or (3) by the Executive other than for Good Reason, the
Company shall pay the Executive all amounts earned or accrued through the
Termination Date (as hereinafter defined) but not paid as of the Termination
Date, including (i) base salary (at the rate then in effect), (ii) reimbursement
for reasonable and necessary expenses incurred by the Executive on behalf of the
Company during the period ending on the Termination Date, and (iii) vacation pay
(collectively, "Accrued Compensation"). In addition to the foregoing, if the
Executive's employment is terminated by the Company for Disability or by reason
of the Executive's death, the Company shall pay to the Executive or his
beneficiaries an amount equal to the Pro Rata Bonus (as hereinafter defined).
The "Pro Rata Bonus" is an amount equal to the Bonus Amount (as hereinafter
defined) multiplied by a fraction the numerator of which is the number of days
in such fiscal year through the Termination Date and the denominator of which is
365. The term "Bonus Amount" shall mean the greater of the (x) Executive's
target bonus under the Xxxxxxxx Soup Company Management Worldwide Incentive Plan
for the fiscal year in which the Termination Date occurs or (y) average of the
annual bonuses paid or payable to the Executive during the two full fiscal years
immediately prior to the Termination Date. Executive's entitlement to any other
compensation or benefits
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shall be determined in accordance with the Company's employee benefit plans and
other applicable programs and practices then in effect.
(b) If the Executive's employment with the Company is
terminated (other than by reason of death), (1) by the Company other than for
Cause or Disability or (2) by the Executive for Good Reason, the Executive shall
be entitled to the following benefits provided below:
(i) The Company shall pay the Executive all
Accrued Compensation and a Pro-Rata Bonus (each as defined in
Section 3.1(a)).
(ii) The Company shall pay the Executive as
severance pay and in lieu of any further compensation for
periods subsequent to the Termination Date, a single sum cash
payment (the "Severance Amount") equal to the amount set forth
in paragraph (a) on Schedule A.
(iii) For a number of months equal to the lesser
of (A) the number of months set forth in paragraph (b) on
Schedule A or (B) the number of months remaining until the
Executive's 65th birthday (the "Continuation Period"), the
Company shall at its expense continue to provide the Executive
and his dependents and beneficiaries the life insurance and
medical benefits in an amount equal to the greater of: (x) the
greater of (1) such benefits provided to the Executive at any
time during the 90-day period immediately prior to the Change
in Control or (2) the benefits provided to the Executive at
any time following the Change in Control or (y) the benefits
provided to other similarly situated executives who continue
in the employ of the Company during the Continuation Period.
The coverage and benefits (including deductibles and costs)
provided in this Section 3.1(b)(iii) during the Continuation
Period shall be no less favorable to the Executive and his
dependents and beneficiaries, than the most favorable of such
coverages and benefits provided during any of the periods
referred to in clauses (x) and (y) above. The Company's
obligation hereunder with respect to the foregoing benefits
shall be limited to the extent that the Executive obtains any
such benefits pursuant to a subsequent employer's benefit
plans, in which case the Company may reduce the coverage of
any benefits it is required to provide the Executive hereunder
as long as the aggregate coverages and benefits of the
combined benefit plans is no less favorable to the Executive
than the coverages and benefits required to be provided
hereunder. This subsection (iii) shall not be interpreted so
as to limit any benefits to which the Executive, his
dependents or beneficiaries may be entitled under any of the
Company's employee benefit plans, programs or practices
following the Executive's termination of employment, including
without limitation, life insurance benefits.
(iv) The Company shall pay the Executive a single
sum cash payment equal to the actuarial equivalent of the
excess of (A) the Supplemental Retirement Benefit (as defined
below) (determined as a straight life annuity commencing at
age 65) determined as if (w) the Executive remained employed
by the Company and accumulated additional months of credited
service as set forth in paragraph
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(c) on Schedule A (but in no event shall the Executive be
deemed to have accumulated additional credited service after
attaining age 65), (x) his annual compensation during such
period had been equal to the sum of (A) the greater of (1) the
Executive's annual base salary in effect at any time during
the 90-day period immediately prior to the Change in Control
or (2) the Executive's annual base salary in effect at any
time following the Change in Control and (B) the Bonus Amount,
(y) the Company and/or the Subsidiary or division made
employer contributions to each defined contribution plan in
which the Executive was a participant at the Termination Date
(in an amount equal to the amount of such contribution for the
applicable plan year immediately preceding the Termination
Date) and (z) the Executive had been fully (100%) vested in
his benefit under each retirement plan in which the Executive
was a participant, over (B) the lump sum actuarial equivalent
of the aggregate retirement benefit the Executive has actually
accrued under such retirement plans (determined as a straight
life annuity commencing at age 65). For purposes of this
subsection (iv), the "Supplemental Retirement Benefit" shall
mean the lump sum actuarial equivalent of the aggregate
retirement benefit the Executive would have been entitled to
receive under the Company's supplemental and other retirement
plans including, but not limited to, the Xxxxxxxx Soup Company
Retirement and Pension Plan for Salaried Employees, the
Xxxxxxxx Soup Company Supplemental Employees' Retirement
Benefit Plan (collectively referred to as the "Retirement
Plan"), the Xxxxxxxx Soup Company Mid-Career Hire Pension
Plan, the Xxxxxxxx Soup Company Savings and 401(k) Plan for
Salaried Employees and the Xxxxxxxx Soup Company Deferred
Compensation Plan. For purposes of this subsection (iv), the
"actuarial equivalent" shall be determined in accordance with
the actuarial assumptions used for the calculation of benefits
under the Company Retirement and Pension Plan for Salaried
Employees as applied prior to the Termination Date in
accordance with such plan's past practices.
(v) In the event that the Executive has unvested
outstanding incentive awards (including restricted stock and
performance shares or units, stock options or stock
appreciation rights, hereinafter collectively referred to as
the "Incentive Awards") pursuant to the terms of the LTIP or
under any subsequent incentive plan or arrangement on his
Termination Date, then (A) all such Incentive Awards shall
vest and any restrictions thereon shall lapse as follows: (i)
all such Incentive Awards (other than performance related
awards) shall vest or become exercisable immediately and any
restrictions thereon shall lapse and (ii) any performance
related awards shall vest or become exercisable and any
restrictions thereon shall lapse on a pro-rata portion of such
awards based on the portion of the relevant performance period
that has expired as of the Termination Date (but in no event
shall such performance related award vest, become exercisable
or restrictions lapse with respect to less than 50% of the
total outstanding awards); provided, that such accelerated
vesting shall apply first to those awards which have been
outstanding the longest, and (B) the Executive shall have the
right to require the Company to purchase, for cash, any shares
of unrestricted stock or shares
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purchased upon exercise of any options, at a price equal to
the fair market value of such shares on the date of purchase
by the Company.
(c) The amounts provided for in Sections 3.1(a) and
3.1(b)(i), (ii), (iv) and (v) (with respect to performance units) shall be paid
within thirty (30) days after the Executive's Termination Date.
(d) The Executive shall not be required to mitigate the
amount of any payment provided for in this Agreement by seeking other employment
or otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Executive in any subsequent employment
except as provided in Section 3.1(b)(iii).
3.2 The severance pay and benefits provided for in
Sections 3.1(a) and 3.1(b)(i) and (ii) shall be in lieu of any other severance
pay to which the Executive may be entitled under any Company severance plan,
program or arrangement (including, without limitation, the Company's Special
Severance Protection Program).
4. Notice of Termination. Following a Change in Control,
any purported termination of the Executive's employment by the Company or by the
Executive shall be communicated by written Notice of Termination to the other
party in accordance with Section 10. For purposes of this Agreement, a "Notice
of Termination" shall mean a notice which indicates the specific termination
provision in this Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated. For purposes of this
Agreement, no such purported termination shall be effective without such Notice
of Termination.
5. Termination Date. For purposes of this Agreement,
"Termination Date" means, in the case of the Executive's death, his date of
death, and in all other cases, the date specified in the Notice of Termination
subject to the following:
(a) If the Executive's employment is terminated by the
Company for Cause or due to Disability, the date specified in the Notice of
Termination shall be at least thirty (30) days from the date the Notice of
Termination is given to the Executive, provided that in the case of Disability
the Executive shall not have returned to the full-time performance of his duties
during such period of at least thirty (30) days; and
(b) If the Executive resigns for Good Reason, the date
specified in the Notice of Termination shall not be more than sixty (60) days
from the date the Notice of Termination is given to the Company.
(c) Notwithstanding any other provision in this Agreement
to the contrary, the termination of the Executive's employment in connection
with the sale, divestiture or other disposition of a division, group or business
unit of the Company (or part thereof) at which the Executive was employed at the
time of such sale, divestiture or other disposition, shall not be deemed to be a
termination of employment of the Executive for purposes of this Agreement,
provided the Executive is offered employment by the purchaser or acquiror of
such division, group or business unit of the Company and the Company obtains an
agreement from such
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purchaser or acquiror as contemplated in Section 8(c) and provided, further,
that the Executive shall not be entitled to any benefits from the Company under
this Agreement as a result of such sale, divestiture, or other disposition, or
as a result of any subsequent termination of employment. This Section 5 (c) will
only apply in the event that (i) the Executive's employment is terminated by the
Company without Cause or the Executive resigns for Good Reason on or after the
occurrence of a Change in Control and (ii) the Executive's employment is
terminated by the Company without Cause within one year prior to a Change in
Control and the Executive reasonably demonstrates that such termination (y) was
at the request of a Third Party who effectuates a Change in Control or (z)
otherwise occurred in connection with, or in anticipation of, a Change in
Control.
6. Excise Tax Payment.
6.1 (a) If any amount or benefit payable to the Executive
under this Agreement and under any other agreement, plan or program of the
Company (such payments and benefits referred to as a "Payment") is subject to
the excise tax imposed under Section 4999 of the Internal Revenue Code of 1986,
as amended (the "Code") or any similar federal or state law (an "Excise Tax"),
the Company shall pay to the Executive an additional amount (the "Gross Up
Amount") in cash, equal to (i) the amount of the Excise Tax, plus (ii) the
aggregate amount of any interest, penalties, fines or additions to any tax which
is imposed in connection with the imposition of such Excise Tax, plus (iii) all
income, excise and other applicable taxes imposed on the Executive under the
laws of any federal, state or local government or taxing authority by reason of
the payments required under clause (i) and clause (ii) and this clause (iii);
provided, however, that a Gross Up Amount will not be paid to the Executive
unless the aggregate amount of Payments received by the Executive which
constitute "parachute payments" under Section 280G(b)(2) of the Code equals or
exceeds the product of 3.1 multiplied by the amount of the Executive's "base
amount" as such term is defined in Section 280G(b)(3) of the Code (the "Base
Amount").
(b) For purposes of determining the Gross Up Amount, the
Executive shall be deemed to be taxed at the highest marginal rate under all
applicable local, state, federal and foreign income tax laws for the year in
which the Gross Up Amount is paid. The Gross Up Amount payable with respect to
an Excise Tax shall be paid by the Company coincident with the Payment with
respect to which such Excise Tax relates.
(c) All calculations under this Section 6.1 shall be made
by a nationally recognized accounting firm designated by the Company and
reasonably acceptable to the Executive (other than the accounting firm that is
regularly engaged by any party who has effectuated a Change in Control) (the
"Accounting Firm"). The Company shall pay all fees and expenses of such
Accounting Firm. The Accounting Firm shall provide its calculations, together
with detailed supporting documentation, both to the Company and the Executive
within 15 days after the Termination Date (or such earlier time as is requested
by the Company) and, if applicable, a reasonable opinion to the Executive that
he is not required to report any Excise Tax on his federal income tax return
with respect to the Payment (collectively, the "Determination"). Within 5 days
of the Executive's receipt of the Determination, the Executive shall have the
right to dispute the Determination (the "Dispute"). The existence of the Dispute
shall not in any way affect the right of the Executive to receive the Payments
in accordance with the Determination.
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If the Executive is successful in the Dispute, the Company shall pay the
Executive any additional amount determined by the Accounting Firm to be due
under this Section 6.1 (together with interest thereon at a rate equal to 120%
of the federal short-term rate determined under Section 1274(d) of the Code)
promptly after such determination.
(d) If there is no Dispute, the final determination by
the Accounting Firm shall be conclusive and binding upon all parties unless the
Internal Revenue Service, a court of competent jurisdiction, or such other duly
empowered governmental body or agency (a "Tax Authority") determines that the
Executive owes a greater or lesser amount of Excise Tax with respect to any
Payment than the amount determined by the Accounting Firm.
(e) If a Taxing Authority makes a claim against the
Executive which, if successful, would require the Company to make a payment
under this Section 6.1, the Executive agrees to contest the claim on request of
the Company subject to the following conditions:
(i) The Executive shall notify the Company of
any such claim within 10 days of becoming aware thereof. In
the event that the Company desires the claim to be contested,
it shall promptly (but in no event more than 30 days after the
notice from the Executive or such shorter time as the Taxing
Authority may specify for responding to such claim) request
the Executive to contest the claim. The Executive shall not
make any payment of any tax which is the subject of the claim
before he has given the notice or during the 30-day period
thereafter unless the Executive receives written instructions
from the Company to make such payment together with an advance
of funds sufficient to make the requested payment plus any
amounts payable under this Section 6.1 determined as if such
advance were an Excise Tax, in which the Executive will act
promptly in accordance with such instructions.
(ii) If the Company so requests, the Executive
will contest the claim by either paying the tax claimed and
suing for a refund in the appropriate court or contesting the
claim in the United States Tax Court or other appropriate
court, as directed by the Company; provided, however, that any
request by the Company for the Executive to pay the tax shall
be accompanied by an advance from the Company to the Executive
of funds sufficient to make the requested payment plus any
amounts under this Section 6.1 determined as if such advance
were an Excise Tax. If directed by the Company in writing the
Executive will take all action necessary to compromise or
settle the claim, but in no event will the Executive
compromise or settle the claim or cease to contest the claim
without the written consent of the Company; provided, however,
that the Executive may take any such action if the Executive
waives in writing his right to a payment under this Section
6.1 for any amounts payable in connection with such claim. The
Executive agrees to cooperate in good faith with the Company
in contesting the claim and to comply with any reasonable
request from the Company concerning the contest of the claim,
including the pursuit of administrative remedies, the
appropriate forum for any judicial proceedings, and the legal
basis for contesting the claim. Upon request of the Company,
the Executive shall take appropriate appeals of any judgment
or decision that would require the Company to make a
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payment under this Section 6.1. Provided that the Executive is
in compliance with the provisions of this subparagraph (ii),
the Company shall be liable for and indemnify the Executive
against any loss in connection with, and all costs and
expenses, including attorneys' fees, which may be incurred as
a result of, contesting the claim, and shall provide to the
Executive within 30 days after each written request therefor
by the Executive cash advances or reimbursement for all such
costs and expenses actually incurred or reasonably expected to
be incurred by the Executive as a result of contesting the
claim.
(f) Should a Tax Authority ultimately determine that an
additional Excise Tax is owed, then the Company shall pay an additional Gross Up
Amount to the Executive in a manner consistent with this Section 6.1 with
respect to any additional Excise Tax and any assessed interest, fines, or
penalties. If any Excise Tax as calculated by the Company or the Accounting
Firm, as the case may be, is finally determined by a Tax Authority to exceed the
amount required to be paid under applicable law, then the Executive shall repay
such excess to the Company within 30 days of such determination; provided, that
such repayment shall be reduced by the amount of any taxes paid by the Executive
on such excess which is not offset by the tax benefit attributable to the
repayment.
6.2 If (i) the aggregate amount of any Payments received
by the Executive which constitute "parachute payments" under Section 280G(b)(2)
of the Code equals less than the product of 3.1 multiplied by the Executive's
Base Amount, and is subject to an Excise Tax, or (ii) if the provisions of
Section 7 of this Agreement are invoked, with respect to the Executive, then the
Company and the Executive agree that the following provisions shall apply:
(A) Notwithstanding anything contained in this Agreement
to the contrary, to the extent that any or all Payments would be subject to the
imposition of an Excise Tax, the Payments shall be reduced (but not below zero)
if and to the extent that such reduction would result in the Executive retaining
a larger amount, on an after tax basis (taking into account federal, state and
local income taxes and the imposition of the Excise Tax), than if the Executive
received all of the Payments (such reduced amount is hereinafter referred to as
the "Limited Payment Amount"). Unless the Executive shall have given prior
written notice specifying a different order to the Company to effectuate the
limitations described in the preceding sentence, the Company shall reduce or
eliminate the Payments, by first reducing or eliminating those payments or
benefits which are not payable in cash and then by reducing or eliminating cash
payments, in each case in reverse order beginning with payments or benefits
which are to be paid the farthest in time from the Determination. Any notice
given by the Executive pursuant to the preceding sentence shall take precedence
over the provisions of any other plan, arrangement or agreement governing the
Executive's rights and entitlements to any benefits or compensation.
(B) All calculations required to be made under this
Section 6.2 shall be made, at the Company's expense, by an Accounting Firm. The
Accounting Firm shall provide their Determination, both to the Company and the
Executive within 15 days after the Executive's Termination Date (or such earlier
time as is requested by the Company) and, with respect to the Limited Payment
Amount, a reasonable opinion to the Executive that he is not required to report
any Excise Tax on his federal income tax return with respect to the Limited
Payment Amount. Within 5 days of the Executive's receipt of the Determination,
the Executive shall have the right
11
24
to Dispute the Determination. The existence of the Dispute shall not in any way
affect the right of the Executive to receive the Payments in accordance with the
Determination. If there is no Dispute, the Determination by the Accounting Firm
shall be final binding and conclusive upon the Company and the Executive (except
as provided in Subsection (C) below).
(C) If it is established that the Payments made to, or
provided for the benefit of, the Executive either have been made or have not
been made by the Company, in a manner inconsistent with the limitations provided
in Subsection (A) (hereinafter referred to as an "Excess Payment" or
"Underpayment", respectively), then the provisions of this Subsection (C) shall
apply. If it is established pursuant to a final determination of a court or an
Internal Revenue Service (the "IRS") proceeding which has been finally and
conclusively resolved, that an Excess Payment has been made, such Excess Payment
shall be deemed for all purposes to be a loan to the Executive made on the date
the Executive received the Excess Payment and the Executive shall repay the
Excess Payment to the Company on demand, together with interest on the Excess
Payment at the applicable federal rate (as defined in Section 1274(d) of the
Code) from the date of the Executive's receipt of such Excess Payment until the
date of such repayment. In the event that it is determined by (i) the Accounting
Firm, the Company (which shall include the position taken by the Company, or
together with its consolidated group, on its federal income tax return) or the
IRS, (ii) pursuant to a determination by a court, or (iii) upon the resolution
to the satisfaction of the Executive of the Dispute, that an Underpayment has
occurred, the Company shall pay an amount equal to the Underpayment to the
Executive within 10 days of such determination or resolution together with
interest on such amount at the applicable federal rate from the date such amount
would have been paid to the Executive until the date of payment.
7. Pooling Savings Clause. If the Company becomes a
party to a transaction or series of transactions that are intended to qualify
for "pooling of interests" accounting treatment and, but for the Executive
entering into this Agreement, would so qualify, then, to the extent that the
Board determines that Section 6.1 of this Agreement would disqualify the
transaction(s) from pooling of interests accounting treatment, then Section 6.1
shall be null and void and any Payments payable to the Executive shall be
subject to Section 6.2.
8. Successors; Binding Agreement.
(a) This Agreement shall be binding upon and shall inure
to the benefit of the Company, its successors and assigns and the Company shall
require any successor or assign to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession or assignment had taken place. In
such event, the term "the Company" as used herein shall include such successors
and assigns. The term "successors and assigns" as used herein shall mean a
corporation or other entity acquiring all or substantially all the assets and
business of the Company (including this Agreement) whether by operation of law
or otherwise.
(b) Neither this Agreement nor any right or interest
hereunder shall be assignable or transferable by the Executive, his
beneficiaries or legal representatives, except by will or by the laws of descent
and distribution. This Agreement shall inure to the benefit of and be
enforceable by the Executive's legal personal representative.
12
25
(c) In the event that one or more divisions, groups and
business units of the Company (or parts thereof) that the Executive is primarily
associated with (or part thereof) are sold, divested, or otherwise disposed of
by the Company subsequent to a Change in Control, the Company shall require such
purchaser or acquiror, as a condition precedent to such purchase or acquisition,
to assume, and agree to perform the Company's obligations under this Agreement,
in the same manner, and to the same extent that the Company would be required to
perform if no such acquisition or purchase had taken place. In such
circumstances, the purchaser or acquiror shall be solely responsible for
providing any payments or benefits payable under this Agreement to the
Executive.
9. Fees and Expense. The Company shall pay all legal
fees and related expenses (including the costs of experts, evidence and counsel)
incurred by the Executive as they become due as a result of (a) the Executive's
termination of employment (including all such fees and expenses, if any,
incurred in contesting or disputing any such termination of employment), (b) the
Executive seeking to obtain or enforce any right or benefit provided by this
Agreement or by any other plan or arrangement maintained by the Company under
which the Executive is or may be entitled to receive benefits, or (c) the
Executive's hearing before the Board as contemplated in Section 2.1 of this
Agreement; provided, however, that the circumstances set forth in clauses (a)
and (b) (other than as a result of the Executive's termination of employment
under circumstances described in Section 2.2(e)) occurred on or after a Change
in Control.
10. Notice. For the purposes of this Agreement, notices
and all other communications provided for in the Agreement (including the Notice
of Termination) shall be in writing and shall be deemed to have been duly given
when personally delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses last given by each party
to the other, provided that all notices to the Company shall be directed to the
attention of the Board with a copy to the Secretary of the Company. All notices
and communications shall be deemed to have been received on the date of delivery
thereof or on the third business day after the mailing thereof, except that
notice of change of address shall be effective only upon receipt.
11. Non-exclusivity of Rights. Nothing in this Agreement
shall prevent or limit the Executive's continuing or future participation in any
benefit, bonus, incentive or other plan or program provided by the Company or
any of its subsidiaries and for which the Executive may qualify, nor shall
anything herein limit or reduce such rights as the Executive may have under any
other agreements with the Company or any of its subsidiaries; provided, however,
to the extent that the Executive receives benefits under this Agreement, he will
not be entitled to severance pay or benefits under any other severance plan,
program, policy or arrangement of the Company, including, without limitation,
the Company's Special Severance Protection Program. Amounts which are vested
benefits or which the Executive is otherwise entitled to receive under any plan,
program or arrangement of the Company or any of its subsidiaries shall be
payable in accordance with such plan, program or arrangement except as expressly
modified by this Agreement.
12. Settlement of Claims. The Company's obligation to
make the payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any circumstances, including,
without limitation, any set-off, counterclaim,
13
26
recoupment, defense or other right which the Company may have against the
Executive or others.
13. Miscellaneous. No provision of this Agreement may be
modified, waived, amended or discharged unless such waiver, modification or
discharge is agreed to in writing and signed by the Executive and the Company.
No waiver by either party hereto at any time of any breach by the other party
hereto of, or compliance with, any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time. No agreement or representations, oral or otherwise, express or implied,
with respect to the subject matter hereof have been made by either party which
are not expressly set forth in this Agreement.
14. Employment Status. This Agreement does not constitute
a contract of employment or impose on the Company any obligation to retain the
Executive, or any obligation on the Executive to remain in the employment of the
Company.
15. Governing Law. This Agreement shall be governed by
and construed and enforced in accordance with the laws of the State of New
Jersey, without reference to the principles of conflicts of laws. Each party
hereto consents to in personam jurisdiction and venue in the United States
District Court of New Jersey. In the event that the United States District Court
of New Jersey should lack subject matter jurisdiction, the parties consent to
jurisdiction and venue in a court of competent jurisdiction in Camden County in
the State of New Jersey.
16. Withholding. The Company may withhold from all
payments due to Executive (or his beneficiary or estate) under this Agreement
all applicable federal, state, local and foreign income and employment taxes.
17. Severability. The provisions of this Agreement shall
be deemed severable and the invalidity or unenforceability of any provision
shall not affect the validity or enforceability of the other provisions hereof.
18. Counterparts. This Agreement may be executed in
several counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same instrument.
19. Headings. The headings contained in this Agreement
are intended solely for convenience and shall not control or affect the meaning
or construction of the provisions of this Agreement.
20. Entire Agreement. This Agreement constitutes the
entire agreement between the parties hereto with respect to the subject matter
hereof and, in the event of a Change in Control, supersedes all prior agreements
(including, without limitation, the Company's Special Severance Protection
Program), understandings and arrangements, whether oral or written, between the
parties hereto with respect to such subject matter.
14
27
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized officer and the Executive has executed this
Agreement as of the day and year first above written.
ATTEST: XXXXXXXX SOUP COMPANY
/s/ Xxxx X. Xxxxx By:/s/ Xxxxxx X. Xxxxxxxxxx
----------------- ------------------------
Corporate Secretary Chairman of the
Board of Directors
EXECUTIVE
By: /s/ Xxxxxxx X. Xxxxxx
---------------------
Xxxxxxx X. Xxxxxx
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Schedule A to Severance Protection Agreement
(a) The Executive's Severance Amount provided for in Section 3.1 (b)
(ii) shall equal the severance pay multiple set forth below next to the
Executive's salary grade level at the Termination Date multiplied by the sum of
(A) the greater of (1) the Executive's annual base salary in effect at any time
during the 90-day period immediately prior to the Change in Control or (2) the
Executive's annual base salary in effect at any time following the Change in
Control and (B) the Bonus Amount.
Salary Grade Level at Termination Date Severance Pay Multiple
-------------------------------------- ----------------------
42 - 44 1.5
46 - 48 2.0
50 and above 2.5
(b) The Benefits Continuation Period provided for in Section 3.1 (b)
(iii) shall be determined using the number of months set forth below next to the
Executive's salary grade level at the Termination Date.
Salary Grade Level at Termination Date Benefits Continuation Period
-------------------------------------- ----------------------------
42 - 44 18 months
46 - 48 24 months
50 and above 30 months
(c) The additional service credit provided for in Section 3.1 (b) (iv)
(w) shall be equal to the number of months set forth below next to the
Executive's salary grade level at the Termination Date.
Salary Grade Level at Termination Date Additional Service Credit
-------------------------------------- -------------------------
42 - 44 18 months
46 - 48 24 months
50 and above 30 months
16
29
EXHIBIT B
XXXXXXXX SOUP COMPANY
NON-COMPETITION AGREEMENT -- U.S. NEW EMPLOYEE
This Agreement is between Xxxxxxxx Soup Company ("CSCo") and Xxxxxxx X. Xxxxxx
("Employee").
Employee understands and agrees that entry into this Agreement is a precondition
for Employee's initial employment by CSCo or its subsidiaries or affiliates, and
for eligibility to receive compensation and benefits to be paid by CSCo or its
subsidiaries or affiliates for his/her services, the other benefits provided
under this Agreement and other valuable consideration;
Employee understands and agrees that Employee would not have been hired by CSCo
or its subsidiaries or affiliates, and that Employee would not have been
eligible to receive compensation and benefits from CSCo or its subsidiaries or
affiliates for his/her services, the other benefits provided under this
Agreement and other valuable consideration, but for Employee's voluntarily
entering into this Agreement;
NOW, in consideration of the respective agreements of the parties contained in
this Agreement, intending to be legally bound and subject to the terms and
conditions stated in this Agreement, it is agreed as follows:
1. Confidential Information. (a) During Employee's employment with CSCo or its
subsidiaries or affiliates, or their successors or assigns, whether existing now
or in the future (collectively "Xxxxxxxx Companies"), Employee will receive and
have access to confidential proprietary information about Xxxxxxxx Companies
("Information") and its worldwide business, including but not limited to
information about costs, profits, sales, marketing or business plans, existing
or prospective customers, suppliers, possible acquisitions or divestitures,
potential new products or markets, personnel, know-how, formulae, recipes,
processes, equipment, discoveries, inventions, research, technical or scientific
information and other data not available to the public, none of which is part of
the general knowledge of the industry.
(b) During and after Employee's employment with Xxxxxxxx Companies ("Employee's
employment"), Employee will not disclose, use, or appropriate Information for
his/her own use or for the use of others, directly or indirectly, except as
required in the performance of Employee's duties to Xxxxxxxx Companies. Employee
recognizes that any unauthorized disclosure, use, or appropriation of
Information would be highly prejudicial to Xxxxxxxx Companies.
(c) In the event that Employee's employment terminates for any reason, Employee
shall deliver to Xxxxxxxx Companies, upon request or before Employee's last day
of employment, all originals and copies of files, writings, reports, memoranda,
diaries, notebooks, notes of meetings or presentations, data, computer tapes or
discs, drawings, charts, photographs, slides, patents, or any other form of
record which contains Information created or produced for, at the direction of
or by Xxxxxxxx Companies, or its employees or agents.
2. No Business Diversion. Employee will not, without the written consent of
CSCo's chief legal officer, for one year following the termination of Employee's
employment (for any reason) either directly or indirectly, solicit, divert or
take away, or attempt to solicit, divert or take away, any customers, business
or suppliers of Xxxxxxxx Companies whom Employee serviced, called upon, or
solicited during Employee's employment, or with whom Employee became acquainted
as a result of Employee's employment.
3. No Employee Solicitation. During Employee's employment, and for a period of
one year thereafter, Employee will not, directly or indirectly, solicit, employ,
interfere with, attempt to entice away from Xxxxxxxx Companies, or recommend for
employment outside Xxxxxxxx Companies, any individual who is employed by
Xxxxxxxx Companies at the time of such solicitation, employment, interference,
or enticement.
4. Non-Competition. (a) During Employee's employment, and for 18 months after
Employee's employment (12 months if Employee's employment is terminated at
Xxxxxxxx Companies' request), Employee will not, directly or indirectly, own,
advise, manage, operate, join, control, receive compensation or benefits from,
or participate in the ownership, management, operation, or control of, or be
employed or be otherwise connected in any manner with, any business which
directly or indirectly competes (as defined in sub-paragraph 4(b)) with, in. any
part of the world, the business of Xxxxxxxx Companies, as conducted or planned
by Xxxxxxxx Companies during Employee's employment.
(b) "Competes" as used in this Agreement means engages in, or plans to engage
in, the production, marketing or selling of any product or service of any person
or organization, other than Xxxxxxxx Companies, which resembles or competes with
a product or service of Xxxxxxxx Companies (or a product or service which, to
Employee's knowledge, was under development
30
by Xxxxxxxx Companies) during Employee's employment.
(c) Except as prohibited in paragraph 4(a), this Agreement will not preclude
Employee from ownership of less than 1% of the outstanding shares of any class
of shares of any corporations listed on the New York Stock Exchange or the
American Stock Exchange or quoted on NASDAQ.
(d) Employee acknowledges that any employment or relationship in violation of
this Agreement would necessarily require Employee to use or rely on Information
to which Employee became privy during the course of Employee's employment with
Xxxxxxxx Companies.
5. Payments to Employee. (a) If despite his/her best efforts, Employee is
unable, within ninety (90) days after the termination of Employee's employment,
to secure other employment not violative of Employee's obligations under this
Agreement, due solely to the provisions of this Agreement, Employee will
notify CSCo's chief legal officer by registered mail. Unless CSCo notifies
Employee in writing that it elects not to enforce paragraph 4 of this Agreement,
CSCo shall provide to Employee, beginning ninety (90) days after termination of
Employee's employment, for as long as CSCo elects to continue to enforce
paragraph 4 of this Agreement, or until such time as Employee finds employment
consistent with this Agreement, with: I) 100% of the base monthly salary
(exclusive of commissions, bonuses, benefits other than those discussed below,
allowances and any other form of compensation) which Employee had been receiving
at termination of Employee's employment, and ii) medical and dental benefits
under the terms provided to other Xxxxxxxx Companies' employees.
(b) As a condition of receiving such payments and benefits, Employee will
conscientiously seek employment and will inform CSCo on a monthly basis, in a
detailed written account, of all such efforts. Employee understands and agrees
that CSCo, in its sole discretion, may elect not to pay Employee for any month
for which Employee does not provide an appropriate written account of efforts to
secure employment. Upon obtaining employment consistent with this Agreement,
Employee will immediately notify CSCo by registered mail, and CSCo's payments to
Employee under the terms of this Agreement shall cease.
(c) CSCo may discontinue such monthly payments and benefits upon ninety (90)
days written notice to Employee based upon any bonafide business reason provided
that Employee shall not then be precluded from accepting employment which
Employee would be free to accept in the absence of this Agreement. In such a
case, payments and benefits will cease ninety (90) days after the notice date or
at the conclusion of 18 months following termination of Employee's employment
(12 months if Employee's employment is terminated at the request of Xxxxxxxx
Companies), whichever occurs sooner.
6. Integration of Severance Pay. If at any time in the future Employee receives
severance pay from Xxxxxxxx Companies, whether under the terms of a severance
pay policy or otherwise, the benefits otherwise payable to Employee under this
Agreement will be integrated with the severance pay. For each calendar month
that Employee receives any amount of severance pay from Xxxxxxxx Companies, the
benefits otherwise payable under paragraph 5 of this Agreement will be reduced,
on a dollar-for-dollar basis (to an amount not less than zero), by the amount of
severance pay paid to Employee in that calendar month.
7. Enforcement of Agreement. (a) Employee agrees that the restrictions in this
Agreement are necessary to protect the legitimate interests of Xxxxxxxx
Companies, and impose no undue hardship on Employee. Employee further agrees
that the breach or threatened breach of any provision of this Agreement will
result in irreparable injury to Xxxxxxxx Companies, for which there is no
adequate remedy at law. Employee consents to the issuance of any restraining or
preliminary restraining order or injunction which arises from, directly or
indirectly, any use, disclosure or conduct by Employee in violation of this
Agreement. Employee agrees that, if Xxxxxxxx Companies prevail in any suit or
proceeding under this Agreement, Employee will pay Xxxxxxxx Companies all of
Xxxxxxxx Companies' attorney fees, costs and expenses incurred in connection
with such suit or proceeding or the enforcement of Xxxxxxxx Companies' rights
under this Agreement, regardless of whether the scope of the no-compete is
reformed by the court.
(b) This Agreement and all terms of Employee's employment shall be governed by,
construed and enforced in accordance with the laws of the State of New Jersey,
without giving effect to conflict of law principles. Each party irrevocably
agrees that any legal proceeding arising out of, or relating to the subject
matter of, this Agreement shall be brought in the Superior Court of New Jersey
in Camden County or the United States District Court of New Jersey, Camden
Vicinage. Each party irrevocably consents to such jurisdiction and venue.
8. Survival. This Agreement shall survive the termination of Employee's
employment for any reason.
9. No Contract of Employment. This Agreement is not a contract of employment,
nor does it impose on Xxxxxxxx Companies any obligation to retain Employee in
its employ. To the contrary, Employee is an employee-at-will.
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10. Reform of Agreement. No provision of this Agreement may be amended or waived
unless agreed to in writing and signed by the chief legal officer of CSCo. The
failure to exercise, or delay in exercising, any right, power or remedy under
this Agreement shall not waive any right, power or remedy which CSCo has under
this Agreement.
11. Severability or Reform By Court. In the event that any provision of this
Agreement is deemed by a court to be broader than permitted by applicable law,
then such provision shall be reformed so that it is enforceable to the fullest
extent permitted by applicable law. If any provision of this Agreement shall be
declared by a court to be invalid or unenforceable to any extent, the validity
or enforceability of the remaining provisions of this Agreement shall not be
affected.
12. Entire Agreement. This Agreement constitutes the entire understanding
between the parties to this Agreement. This Agreement supersedes all prior
agreements, understandings and arrangements, oral or written, between the
parties with respect to the subject matter of this Agreement (with the exception
of the one page "Employee Agreement"). This Agreement was entered into in the
State of New Jersey and is effective as of the date that Employee commences
employment with Xxxxxxxx Companies.
EMPLOYEE ACKNOWLEDGES THAT HE/SHE HAS READ THE ABOVE DOCUMENT AND HAS BEEN GIVEN
ADEQUATE TIME TO CONSULT WITH AN ATTORNEY OR OTHER ADVISOR OF HIS/HER CHOICE.
/s/ Xxxxxxx X. Xxxxxx XXXXXXXX SOUP COMPANY
------------------------------
Employee's Signature
Xxxxxxx X. Xxxxxx By: /s/ Xxxx X. Xxxxx
------------------------------ ------------------------------
Employee's Name (printed) Corporate Secretary
Date: January 8, 2001
32
EXHIBIT C
XXXXXXXX SOUP COMPANY
EMPLOYEE AGREEMENT
In consideration of my employment by XXXXXXXX SOUP COMPANY or any of
its subsidiaries or affiliated corporations ("Xxxxxxxx") and other valuable
consideration, I agree:
1. As used in this Agreement, "trade secrets" means information
disclosed to me or known by me as a result of my employment by Xxxxxxxx, not
generally known in the industry in which Xxxxxxxx is engaged, which Xxxxxxxx
considers to be proprietary and confidential, including, but not limited to,
information concerning business plans, financial information, products,
services, manufacturing processes, costs, sources of supply, strategic plans,
advertising and marketing plans, customer lists, sales, profits, pricing
methods, personnel, business relationships, research and development,
discoveries, improvements, processes, know-how, drawings, blueprints,
specifications, samples, formulae, patents, copyrights, trademarks, trade names,
and patent, trademark and copyright applications, whether or not reduced to
writing or other tangible expression.
2. During and after my employment, I will not divulge, use or
appropriate for my own use or for the use of others, except as Xxxxxxxx may
authorize or direct, any trade secrets or other secret or confidential
information or knowledge obtained by me during my employment.
3. I will not disclose to Xxxxxxxx or induce Xxxxxxxx to use any
secret or confidential information or material belonging to others, including my
former employers, if any.
4. I will fully and promptly disclose and assign to Xxxxxxxx
without additional compensation all ideas, inventions, discoveries and
improvements, patentable or not, which, while I am so employed, are made,
conceived or reduced to practice by me, alone or with others, during or after
usual working hours either on or off my job, and which are related to the
business or interests of or which result from tasks assigned to me by Xxxxxxxx.
5. I agree, at Campbell's expense, at any time during or after my
employment, to sign all papers and do such other acts and things as Xxxxxxxx
deems necessary or desirable and may reasonably require of me to protect
Campbell's rights to such ideas, discoveries, inventions and improvements,
including applying for, obtaining and enforcing patents on such ideas,
discoveries, inventions, and improvements in any or all countries.
6. Upon termination of my employment, I will promptly deliver to
Xxxxxxxx all property belonging to Xxxxxxxx then in my possession, including all
drawings, blueprints, manuals, letters, notes, notebooks, reports or other
material whether recorded, written or electronic and all other materials of a
secret or confidential nature relating to Campbell's business.
7. This Agreement will be interpreted in accordance with the laws
of the State of New Jersey and I agree to submit to personal jurisdiction in the
State of New Jersey in any action arising out of this Agreement. With respect to
its subject matter, this Agreement supersedes any previous oral or written
communications, representations, understandings or agreements with Xxxxxxxx and
can be amended only in writing signed by both parties. I recognize that a breach
of this Agreement would cause irreparable harm to Xxxxxxxx and agree that,
without limiting other available remedies, Xxxxxxxx will be entitled to an
injunction if I fail to comply with this Agreement.
I HAVE READ THE ABOVE DOCUMENT, ACKNOWLEDGE RECEIVING A COPY,
UNDERSTAND IT FULLY, AND AGREE WITH ALL THE TERMS SET FORTH HEREIN.
January 8, 2001 /s/ Xxxxxxx X. Xxxxxx
------------------ ---------------------
Date Signature of Employee
Witness WHQ - Camden
------------
Location
/s/ Xxxx X. Xxxxx ###-##-####
------------------ -----------
Social Security Number
cc: Employee Personnel File
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EXHIBIT D
PERFORMANCE MAKES A DIFFERENCE Date of Grant: DATE
STOCK OPTION AWARD STATEMENT
NAME
TITLE
CONGRATULATIONS!
You have been awarded AMOUNT Stock Options at a price of $__________.
Each option represents your right to purchase a share of Xxxxxxxx Soup Company
stock at the price stated above.
Providing you continue to be employed by the Company, your right to exercise
these options extends 10 years from the date of the grant. Under a provision
approved by Campbell's Board of Directors in 1996, you will have the entire 10
year period in which to exercise these options if you retire from the Company
during that time. If your employment terminates for any other reason, refer to
Section 5.6 of the 1994 Long-Term Incentive Plan for an explanation of your
rights.
These options vest in three installments as follows:
- 30% on Date 1
- an additional 30% on Date 2
- the balance on Date 3
This statement is not intended to fully explain stock option awards. Please
consult the 1994 Long-Term Incentive Plan for a complete understanding of the
Company's stock option program.
Chairman
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EXHIBIT E
GENERAL RELEASE OF CLAIMS
This General Release of Claims ("Agreement"), between -- Name --
("Employee") and -- Company -- ("Company"), is made with respect to the
following facts:
A. Company has decided to sever its employment relationship with
Employee effective -- Term Date -- ("Termination Date").
B. In consideration of Employee's signing this Agreement and releasing
Company from any and all claims which he might have against it, Company will,
upon the termination of Employee's employment, provide Employee with the
severance pay and benefits provided under the Employee's Employment Agreement or
Severance Protection Agreement, whichever is applicable.
1. Release by Employee.
a. Employee hereby forever releases Company and its officers,
directors, shareholders, agents, employees, affiliates, subsidiaries, parent
company, predecessors, successors and assigns ("Releasees"), from any and all
complaints, charges, claims, liabilities, demands, debts, accounts, obligations,
promises, suits, actions, causes of action, demands in law or equity, including
claims for damages, attorneys' fees or costs, whether known or unknown, which
Employee now has, or claims to have, or which Employee at any time may have had,
or claimed to have, or which Employee at any time hereafter may have, or claim
to have, arising at any time in the past to and including the date of this
Agreement, relating in any way to Employee's employment relationship or the
termination of that employment relationship with Company.
b. The claims, rights and obligations that Employee is
releasing herein include, but are not limited to: (i) those for wrongful
discharge, breach of contract, breach of implied contract, breach of implied
covenant of good faith and fair dealing, and any other common law or statutory
claims now or hereafter recognized; and (ii) those for discrimination (including
but not limited to claims for discrimination, harassment or retaliation on
account of sex, age, handicap, medical condition or disability, national origin,
race, color, religion, sexual preference, or veteran status) which Employee
might have or might have had under the federal Age Discrimination in Employment
Act, Title VII of the Civil Rights Act, and any other federal, state or local
laws prohibiting discrimination, harassment or retaliation in employment. BY
SIGNING THIS AGREEMENT, EMPLOYEE AGREES TO GIVE UP, OR WAIVE, ANY RIGHTS OR
CLAIMS WHICH HE MAY HAVE HAD UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF
1967, 29 U.S.C. SECTION 621 ET. SEQ., OR ANY OTHER STATUTE OR OTHER LAW, WHICH
ARE BASED ON ACTIONS OF XXXXXXXX SOUP COMPANY, ITS AFFILIATES OR ITS EMPLOYEES
OR AGENTS, WHICH OCCURRED UP THROUGH THE DATE THAT EMPLOYEE SIGNS THIS
AGREEMENT.
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c. Except as otherwise provided in Paragraph 1.e below,
Employee further acknowledges and agrees that this Agreement shall operate as a
complete bar to recovery in any and all litigation, charges, complaints,
grievances or demands of any kind whatsoever now pending or now contemplated by
Employee, or which might at any time be filed by Employee, including, but
without limiting the generality of the foregoing, any and all matters arising
out of or in any manner whatsoever connected with the matters set forth in
Paragraph 1a. above. Each and all of the said claims are hereby fully and
finally settled, compromised and released.
d. Employee further acknowledges and agrees that neither
Employee, nor any person, organization, or other entity on Employee's behalf,
will file, claim, xxx or cause or permit to be filed or claimed, or join in any
claims, as an individual or as a class member, any action for legal or equitable
relief (including damages and injunctive, declaratory, monetary or other
relief), involving any matter or related in any way to Employee's employment
relationship or the termination of Employee's employment relationship with the
Company, or involving any continuing effects of any acts or practices that may
have arisen or occurred during Employee's employment relationship with the
Company.
e. Nothing in this paragraph 1 is intended to operate as a
release, waiver, or forfeiture of Employee's rights, and Company's obligations,
(i) under this Agreement;
(ii) with respect to claims for indemnification under the
Employee's Employment Agreement, the Company's Articles of
Incorporation and By-Laws, or under any applicable insurance policy, or
any right to obtain contribution as permitted by law in the event of
entry of judgment against the Employee as a result of any act or
failure to act for which the Employee and the Company are jointly
liable;
(iii) under Employee's Employment Agreement or Severance
Protection Agreement which include severance pay, benefits and other
obligations, set forth in Exhibit A hereto to the extent such payments,
benefits or other obligations set forth in Exhibit A attached hereto
have not already been provided for as of the date of this Agreement
[NOTE: EXHIBIT A WILL NOT BE PREPARED UNTIL THE TIME THE RELEASE IS
ACTUALLY EXECUTED];
(iv) under any of the Company's employee benefit plans in
which the Employee has been a participant, including, but not limited
to, Xxxxxxxx Soup Company's Retirement and Pension Plan for Salaried
Employees, and Xxxxxxxx Soup Company's Savings and 401(k) Plan for
Salaried Employees,
(v) under any health and welfare benefits to which Employee
may in the future be entitled under "COBRA" or comparable federal or
state law or regulation, or
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(vi) under any state worker's compensation act or statute.
Upon the termination of Employee's employment with the Company, Employee's
rights under the applicable employee benefit plans of the Company will be
determined in accordance with the terms of the plans, the Employment Agreement
or the Severance Protection Agreement, whichever is applicable.
2. Release by Company. Company, on behalf of itself and its
officers, directors, agents, employees, affiliates, subsidiaries, parent
company, predecessors, successors and assigns ("Company Releasors"), hereby
forever releases Employee, his heirs, personal representatives, successors and
assigns from any and all complaints, charges, claims, liabilities, demands,
debts, accounts, obligations, promises, suits, actions, causes of action,
demands in law or equity, including claims for damages, attorneys' fees or
costs, whether known or unknown, which Company Releasors now have, or claim to
have, or which Company Releasors at any time may have had, or claimed to have
had, or which Company Releasors at any time hereafter may have, or claim to
have, arising at any time in the past up to and including the date of this
Agreement relating in any way to Employee's employment relationship or
termination of that employment relationship with Company, except for claims or
obligations based on or arising out of (i) this Agreement; (ii) the
Non-Competition Agreement executed by Company and Employee dated as of January
8, 2001; (iii) the Employee Agreement executed by Employee dated as of January
8, 2001; (iv) any act, or omission, by Employee in connection with his
employment with Company that is in breach of Employee's duty of loyalty to
Company or its shareholders; (v) any act, or omission, by Employee in connection
with his employment with Company that is not in good faith or involving a
knowing violation of law; or (vi) any act, or omission, by Employee in
connection with his employment with Company that results in receipt by Employee
of an improper personal benefit.
3. Inquiries.
a. In the event that inquiries are made by prospective
employers concerning Employee's employment with the Company, the Company will
use its best efforts to refer those inquiries to the Company's Vice President -
Human Resources, or his designate.
b. Employee will not take any action, or make any
statement, whether orally or in writing, which, in any manner, disparages or
impugns the reputation or goodwill of the Company, its Directors or officers, or
other Releasees. Directors or officers of Company will not take any action, or
make any statement, whether orally or in writing, which, in any manner,
disparages or impugns the reputation of Employee.
4. Successors and Assigns. This Agreement shall bind Company and
Employee, and also all of their respective family members, heirs,
administrators, representatives, successors, assigns, officers, directors,
agents, employees, shareholders, affiliates, predecessors, and also all other
persons, firms, corporations, associations, partnerships and entities in privity
with or related to or affiliated with any such person, firm, corporation,
association, partnership or entity.
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5. Effect of Agreement. Employee acknowledges and agrees that
this Agreement is not and shall not be construed as an admission of any
violation of any federal, state, or local statute, ordinance or regulation, or
of any duty or obligation the Company owes or owed to Employee, and that
Employee's execution of this Agreement is a voluntary act to provide an amicable
conclusion to Employee's employment relationship with the Company.
6. Confidentiality of Agreement. Employee expressly agrees that
the terms and conditions of this Agreement will not be disclosed to any
individual, entity or organization not a party to this Agreement, other than
Employee's immediate family, legal counsel or tax advisors, unless such
disclosure shall be required by law (or shall be necessary or desirable in
connection with the defense of any lawsuit). Notwithstanding the foregoing,
Employee may explain such non-disclosure by referring to this confidentiality
obligation.
7. Confidentiality of Proprietary Information. Employee
acknowledges and agrees that in the course of his employment with the Company
Employee has acquired confidential or proprietary information relating to the
business of the Company and/or its affiliates. Employee expressly agrees that
Employee will keep secret and safeguard all such information, and will not, at
any time, in any form or manner, directly or indirectly, divulge, disclose or
communicate to any person, firm, corporation, or other entity any such
information without the direct written authority of the Company. This Agreement
incorporates by reference all of the provisions of any of the following
agreements which Employee previously signed: Employment Agreement, Severance
Protection Agreement, Employee Agreement, Non-Competition Agreement and/or any
other agreement which by its terms prohibits Employee's employment or
involvement with certain companies or activities after the termination of
Employee's Company employment. The parties hereby stipulate that, as between
them, the foregoing matters are material and confidential, and gravely affect
the effective and successful conduct of the business of the Company, and its
goodwill, and that the Company is entitled to an injunction by any competent
court to enjoin and restrain the unauthorized disclosure of such information.
8. Return of Company Property.
a. Upon signing this Agreement, Employee agrees to
return to the Company any office, desk and file keys, Company identification
pass cards, Company-provided credit cards issued to Employee, and any other
Company property in the possession of Employee or his agents on or before -
LastDay --. Employee acknowledges and represents that he has surrendered and
delivered to the Company all files, papers, data, documents, lists, charts,
photographs, computer records, discs or any other records, relating in any
manner to the business activities of the Company or its affiliates, which were
created, produced, reproduced or utilized by the Company, or any of the
Releasees, or by Employee during the term of Employee's employment relationship
with the Company.
b. Except as otherwise agreed by parties in writing,
Employee also agrees to repay any monies owed to the Company, including loans,
advances, charges or debts incurred by the Employee, or any other amounts owed
to the Company, on or before Employee's last day of work.
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9. Competency of Employee. Employee acknowledges, warrants,
represents and agrees that in executing and delivering this Agreement, he does
so freely, knowingly and voluntarily and that he is fully aware of the contents
and effect thereof and that such execution and delivery is not the result of any
fraud, duress, mistake or undue influence whatsoever.
10. Unknown or Mistake in Facts. It is acknowledged and understood
by the parties that the facts with respect to this Agreement as given may
hereafter turn out to be other than or different from the facts in that
connection now known to them or believed by them to be true, and the parties
therefore expressly assume the risk of the facts being different and agree that
this Agreement shall be in all respects effective and not subject to termination
or rescission by any such difference in facts. In addition, it is acknowledged,
understood and agreed by Employee that should the Company discover that Employee
has breached his fiduciary obligations to the Company (or any affiliated
corporate entity), engaged in any unethical, dishonest or fraudulent act which
affects, or has affected the Company (or any affiliated corporate entity), or
committed any act previously unknown to the Company which would constitute
grounds for discharge, that Company reserves the right, in its sole discretion,
to terminate or suspend all payments or benefits remaining to be paid by the
Company under this Agreement. In addition, the Company may seek all other
remedies and relief allowed by law.
11. Savings Clause. It is acknowledged and agreed by the parties
that should any provision of this Agreement be declared or be determined to be
illegal or invalid by final determination of any court of competent
jurisdiction, the validity of the remaining parts, terms or provisions of this
Agreement shall not be affected thereby, and the illegal or invalid part, term
or provision shall be deemed not to be a part of this Agreement.
12. Enforcement. The parties expressly agree that this Agreement
constitutes a binding contract. If Employee breaches any term of this Agreement,
or violates any of his obligations under this Agreement, the Company may, at its
option, terminate or suspend all payments or benefits remaining to be paid by
the Company under this Agreement. In addition, the Company may seek all other
remedies and relief allowed by law.
13. Effective Date. It is acknowledged and agreed by the parties
that Employee has had twenty-one (21) days to consider this Agreement before
signing it. Further, Employee has the right to revoke this Agreement within
eight (8) days after signing and returning this Agreement to the Company. This
Agreement will not become effective or enforceable, and employee will not
receive any of the severance pay and benefits described in this Agreement, until
the eight (8) day revocation period has run, and Employee notifies the Company,
in writing, that he has elected not to revoke this Agreement.
14. Employee Rights. Employee acknowledges, represents and agrees
to the following:
a. HE HAS BEEN ADVISED, IN WRITING, TO READ THIS ENTIRE
AGREEMENT CAREFULLY, AND TO CONSULT WITH AN ATTORNEY OF HIS CHOICE PRIOR TO
SIGNING THIS AGREEMENT;
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b. He was given at least twenty-one (21) days to
consider this Agreement before signing it;
c. He was advised, in writing, that he had a full eight
(8) days after he signed this Agreement to revoke it, and that this Agreement
would not become effective until that eight (8) day revocation period had run
and he had notified Company, in writing, that he has elected not to revoke this
Agreement;
d. He carefully read this Agreement prior to signing it,
and that he fully understands this Agreement;
e. He understands and agrees that he will receive
severance pay and benefits in exchange for signing this Agreement, and that he
would not have received severance pay and benefits if he had not signed this
Agreement;
f. EMPLOYEE UNDERSTANDS THAT, BY SIGNING THIS AGREEMENT,
HE WILL LOSE HIS RIGHT TO XXX XXXXXXXX SOUP COMPANY, ITS AFFILIATES OR ANY OF
ITS EMPLOYEES OR AGENTS, FOR ANY VIOLATION OF THE AGE DISCRIMINATION IN
EMPLOYMENT ACT (THE FEDERAL LAW WHICH PROHIBITS DISCRIMINATION ON THE BASIS OF
AGE), OR ANY OTHER STATUTE OR OTHER LAW; and
g. He has signed this Agreement voluntarily.
15. Entirety of Agreement; Modifications. Employee acknowledges
and agrees that this document, and the attached Addendum, if any, contains the
entire agreement and understanding concerning the subject matter between
Employee and the Company, and that it supersedes and replaces all prior
agreements, whether written or oral, except for the agreements referred to in
paragraph 8 of this Agreement, which are incorporated by reference. Employee
also represents that he has not executed this instrument in reliance on any
promise, representation or statement not contained herein. This Agreement may
not be modified except by a writing signed by each of the parties hereto, or
their duly authorized representatives.
_______________________________ _________________________________________
Employee Company
Date: _________________________ By: ___________________________________
Title: ________________________________
Date: _________________________________
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EMPLOYEE: PLEASE SELECT AND COMPLETE ONE OF THE
PARAGRAPHS BELOW.
I, _______________________ , have read all of the terms of this
Agreement. I have been informed by the Company that I have the right to consult
with an attorney who is not associated with the Company. I have been given
sufficient time and opportunity to consult with an attorney, and I have
voluntarily chosen not to do so. I understand the terms of this Agreement,
including the fact that my employment relationship with the Company is
permanently ended, and that the Agreement releases the Company forever from any
legal action arising from my employment relationship with or my separation from
the Company.
Employee _______________________________
Date: _______________________________
Prior to signing this Agreement I, _______________________ , consulted
_______________________ , Esq., at the law firm of _______________________ ,
located at _______________________ , who reviewed the Severance Agreement and
General Release and provided advice to me. I understand the terms of this
Agreement, including the fact that my employment relationship with the Company
is permanently ended, and that the Agreement releases the Company forever from
any legal action arising from my employment relationship with or my separation
from the Company.
Employee _______________________________
Date: _______________________________
