Contract
Exhibit 10.2
Ralcorp
Holdings, Inc. (the "Company"), effective February 2, 2005, grants this
Non-Qualified Stock Option to __________ ("Optionee") to purchase a total of
____ shares of its $.01 par value Common Stock (the "Common Stock") at a price
of $45.25 per share pursuant to the Ralcorp Holdings, Inc. 2002 Incentive Stock
Plan (the "Plan"). Subject to the provisions of the Plan and the following
terms, Optionee may exercise this option from time to time by tendering to the
Company (or its designated agent), written notice of exercise together with the
purchase price in either cash, or in shares of Common Stock of the Company at
their fair market value as determined by the Corporate Governance and
Compensation Committee of the Company's Board of Directors (the "Committee"), or
in both cash and such shares.
NOW
THEREFORE, the
Company and Optionee agree, for and in consideration of the terms hereof, as
follows:
1. |
Normal
Exercise -
This Option becomes exercisable at the rate of 33 1/3% of the total shares
on each of February 2, 2008, 2009 and 2010. This Option remains
exercisable through February 2, 2012, unless Optionee is no longer
employed by the Company, in which case the Option is exercisable only if
permitted by, and in accordance with, the provisions of paragraph 2
below. |
2. |
Accelerated
Exercise -
Notwithstanding the above, this Option shall become exercisable before the
normal exercise dates set forth in paragraph 1 above upon the
occurrence of any of the events set forth below while Optionee is employed
by the Company (hereinafter referred to as an "Accelerating Event"). This
Option shall become exercisable in full on the date of such Accelerating
Event (except in the case of "a." below), as set forth below, and shall
remain exercisable for the periods also set forth below or until February
2, 2012, whichever occurs first. Thereafter, the unexercised portion of
this Option is forfeited and may not be exercised. An Accelerating Event
may be any of the following: |
a. |
Stock
Price; at any time after February 2, 2005, the closing price of the Common
Stock on the New York Stock Exchange (the "NYSE") is at least $55.00 per
share for five (5) consecutive trading days, the Option shall accelerate
as described in the following sentences. Upon the occurrence of this
Accelerating Event, the Option shall become immediately exercisable on
February 2, 2008 (if the Accelerating Event occurred earlier) or
immediately after the occurrence of the Accelerating Event (if the
Accelerating Event occurs after February 2, 2008) and shall remain
exercisable through February 2, 2012. In the event the Common Stock no
longer trades on the NYSE, the Committee shall have the discretion to
designate another trading market or other valuation method for purposes of
determining whether this Acceleration Event has
occurred. |
b. |
Death
of Optionee; exercisable for three years. |
c. |
Declaration
of Optionee's total and permanent disability; exercisable for three
years. |
d. |
Voluntary
termination of Optionee's employment at or after attainment of age 62;
exercisable for three years. |
e. |
Involuntary
termination of employment of Optionee, other than a Termination for Cause;
exercisable for six months. |
f. |
Occurrence
of a Change in Control; exercisable for six months after the Optionee's
voluntary or involuntary termination of employment following the Change in
Control. |
3. |
Forfeiture -
This paragraph sets forth the circumstances under which this Option will
be forfeited. All shares not exercisable shall be forfeited upon the
occurrence of any of the following events (any of which is referred to as
a "Forfeiture Event"): |
a. Optionee
is Terminated for Cause;
b. Optionee
voluntarily terminates prior to age 62;
c. Optionee
engages in competition with the Company; or
d. Optionee
engages in any of the following actions:
(i) |
intentional
misconduct in the performance of Optionee's job with the Company or any
subsidiary; |
(ii) |
being
openly critical in the media of the Company or any subsidiary or its
directors, officers, or employees or those of any
subsidiary; |
(iii) |
pleading
guilty or nolo contendere to any felony or any charge involving moral
turpitude; |
(iv) |
misappropriating
or destroying Company or subsidiary property including, but not limited
to, trade secrets or other proprietary
property; |
(v) |
improperly
disclosing material nonpublic information regarding the Company or any
subsidiary; |
(vi) |
after
ceasing employment with the Company, inducing or attempting to induce any
employee of the Company or any Subsidiary to leave the employ of the
Company or any subsidiary; |
(vii) |
after
ceasing employment with the Company, hiring any person who was a manager
level employee of the Company or any subsidiary;
or |
(viii) |
inducing
or attempting to induce any customer, supplier, lender, or other business
relation of the Company or any subsidiary to cease doing business with the
Company or any subsidiary. |
Upon
the occurrence of a Forfeiture Event, those portions of this Option not
exercisable at the time of a Forfeiture Event will be forfeited and may
not be exercised. Notwithstanding any other provision of this Option, any
portion of this Option exercisable (either in accordance with the normal
exercise dates set forth in paragraph 1 or pursuant to an acceleration of
exercisability under paragraph 2) at the occurrence of a Forfeiture Event
shall remain exercisable for seven days following the occurrence of a
Forfeiture Event. Therefore, any exercisable portion of this Option that
is not exercised within such seven-day period will be forfeited and may
not be exercised. The Committee or entire Board of Directors may
waive any condition of forfeiture described in this
paragraph. |
4. |
Change
in Control -
In the case of a Change in Control (other than a transaction in which the
Company is the continuing or surviving corporation and which does not
result in the outstanding shares of Common Stock being converted into or
exchanged for different securities, cash or other property, or any
combination thereof), Optionee shall have the right (subject to the
provisions of the Plan and any limitation applicable to the Option
contained herein) thereafter and during the term of the Option, to receive
upon exercise thereof the Acquisition Consideration (as defined
below) receivable upon the Change in Control by a holder of the number of
shares of Common Stock which would have been obtained upon exercise of the
Option or portion thereof, as the case may be, immediately prior to the
Change in Control. |
5. |
Definitions -
For purposes of this Agreement, the following terms have the meanings as
set forth below: |
a. |
"Acquisition
Consideration" -
Shall mean the kind and amount of shares of the surviving or new
corporation, cash, securities, evidence of indebtedness, other property or
any combination thereof receivable in respect of one share of the Common
Stock upon consummation of a Change in Control. In the case of a Change in
Control resulting from the event set forth in paragraph 5(b)(i), the value
of the Acquisition Consideration shall be equal to the highest price paid
by such person for a share of the Company’s Common Stock during the
two-year period preceding the date on which such person became the
beneficial owner of more than 50% of the Company’s Common Stock. If such
price is paid in the form of non-cash consideration, the value of the
Acquisition Consideration shall be equal to the fair market value of such
consideration at the time of the purchase of such
share. |
b. |
"Change
in Control" -
Shall mean when (i) a person, as defined under the securities laws of the
United States, acquires beneficial ownership of more than 50% of the
outstanding voting securities of the Company; or (ii) the directors of the
Company, immediately before a business combination between the Company and
another entity, or a proxy contest for the election of directors, shall as
a result of such business combination or proxy contest, cease to
constitute a majority of the Board of Directors of the Company or any
successor to the Company. |
c. |
"Termination
for Cause" -
Shall mean the Optionee's termination of employment with the Company
because of the willful engaging by the Optionee in gross misconduct;
provided, however, that a termination for cause shall not include
termination attributable to: (i) poor work performance, bad judgment or
negligence on the part of the Optionee; (ii) an act or omission believed
by the Optionee in good faith to have been in or not opposed to the best
interests of the Company and reasonably believed by the Optionee to be
lawful; or (iii) the good faith conduct of the Optionee in connection with
a Change in Control (including opposition to or support of such Change in
Control). |
6. |
This
Agreement shall be governed by the laws of the State of Missouri without
reference to the conflict of laws provisions
thereof. |
7. |
No
amendment or modification of this Option shall be valid unless the same
shall be in writing and signed by the Company and Optionee. The foregoing,
however, shall not prevent the Company from amending or modifying the Plan
except that no such amendment or modification shall adversely affect the
Optionee’s rights under this Option
Agreement. |
ACKNOWLEDGED RALCORP
HOLDINGS, INC.
AND
ACCEPTED:
____________________________ BY: /s/
X. X. Xxxxx, Xx. Optionee
Secretary
____________________________
Date
____________________________
Location
____________________________
S.S.#