Exhibit 10.3
Conformed Copy
RETENTION AGREEMENT
THIS AGREEMENT, made as of this 1st day of November
1991 (the "Effective Date"), by and between DEL MONTE
CORPORATION, a New York corporation (the "Company") and XXXXX X.
XXXXXX (the "Executive").
W I T N E S S E T H;
WHEREAS, in order to provide the Executive continued
incentives to remain in the services of the Company, its
subsidiaries or affiliates, the Company desires to provide the
Executive with compensation security under the conditions set
forth in this Agreement in the event that the Executive's
employment hereunder is terminated by the Company or any such
subsidiary or affiliate without Cause (as hereinafter defined) or
the Executive resigns his employment hereunder for Good Reason
(as hereinafter defined);
NOW, THEREFORE, in consideration of the premises and
covenants herein contained, the parties hereto hereby agree as
follows:
1. Employment. The Executive agrees to devote his
working time, on substantially a full-time basis, to the
performance of such services for the Company, its subsidiaries
and affiliates as may be assigned to him from time to time and to
perform such services faithfully and to the best of his ability.
This Agreement shall commence on the Effective Date and shall
remain in effect so long as the Executive remains employed by the
Company, any of its subsidiaries or any successor organization.
2. Termination for Cause: Resignation without Good
Reason; Termination by Reason of Death. (a) This Agreement shall
be terminated immediately and neither party shall have any
obligation hereunder if the Executive's employment is terminated
for Cause (as hereinafter defined) or by reason of the
Executive's death or if the Executive resigns his employment
hereunder for other than Good Reason.
(b) The Executive shall be terminated for "Cause" only
if the Executive's employment is terminated as a result of (i)
criminal dishonesty, (ii) deliberate and continual refusal to
perform employment duties on substantially a full-time basis or
to act in accordance with any specific lawful instructions given
to the Executive in connection with the performance of his duties
for the Company or any of its subsidiaries or affiliates, unless,
in either case, (A) the Executive became aware less than ninety
(90) days prior thereto of an event constituting Good Reason or
(B) the Executive is disabled, or (iii) deliberate misconduct
which is reasonably likely to be materially damaging to the
Company without a reasonable good faith belief by the Executive
that such conduct was in the best interests of the Company.
(c) Resignation for "Good Reason" shall mean the
resignation of the Executive after: (i) a reduction without the
Executive's consent in the Executive's salary or the bonus that the
Executive is eligible to earn under the Company's Annual Incentive Award
Plan (or successor plan thereto); provided, however, that nothing
herein shall be construed to guarantee the Executive's bonus for
any year if the applicable performance targets are not met; and
provided, further, that it shall not constitute Good Reason
hereunder if the Company makes an appropriate pro rata adjustment
to the applicable bonus and targets under the Annual Incentive
Award Plan in the event of a change in the Company's fiscal year;
(ii) a material reduction without the Executive's consent in the
aggregate welfare benefits provided to the Executive
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pursuant to the welfare plans, programs and arrangements in which
the Executive is eligible to participate; or (iii) a material
reduction without the Executive's consent in the Executive's job
responsibilities. Unless the Executive provides written
notification of an event described in clauses (i) through (iii)
above within ninety (90) days after the Executive knows or has
reason to know of the occurrence of any such event, the Executive
shall be deemed to have consented thereto and such event shall no
longer constitute Good Reason for purposes of this Agreement. If
the Executive provides such written notice to the Company, the
Company shall have ten (10) business days from the date of
receipt of such notice to effect a cure of the event described
therein and, upon cure thereof by the Company to the reasonable
satisfaction of the Executive, such event shall no longer
constitute Good Reason for purposes of this Agreement.
3. Termination Without Cause; Resignation for Good
Reason.
(a) Severance Amount. If the Executive's employment
hereunder is terminated by the Company without Cause, or if the
Executive resigns from his employment hereunder for Good Reason,
the Company shall pay to the Executive the Severance Amount (as
hereinafter defined) over a three (3) year period commencing with
the date of such termination or resignation (the "Severance
Period"). The total severance amount (the "Severance Amount") for
the Severance Period shall equal twice the sum of (A) plus (B),
where (A) is the Executive's highest annual rate of Salary in
effect during the twelve (12) month period prior to such
termination or resignation and (B) is the target award under the
Company's Annual Incentive Award Plan (or successor thereto) for
the year in which such termination or resignation occurs (or, if
greater, the amount of the award for the next preceding year of full-
time employment). The Severance Amount shall be paid to the Executive
in thirty-six (36) equal monthly installments over the Severance
Period and each such installment shall be subject to regular
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payroll deductions. In addition, the Executive will also be paid
an award under the Annual Incentive Award Plan (or successor
thereto, if any) of the Company, based upon the target award for
the year in which the Executive's termination without Cause or
resignation for Good Reason occurs, prorated for the Executive's
active employment during such year and adjusted for performance.
Such pro rata bonus shall be paid within thirty (30) days of the
date of such termination or resignation.
(b) Employee Benefit Plans. In the event of a
termination or resignation of the Executive's employment
described in this Section 3, the Executive will be provided the
welfare benefits afforded by the employee benefit plans and
programs maintained by the Company in which he participated (and
at an equivalent level of participation) immediately prior to
such termination or resignation (or, in the event of any material
reduction in the aggregate benefits provided under such plans and
programs occurring during the twelve (12) month period prior to
such termination or resignation, prior to such reduction in
benefits) until the earlier to occur of (i) the end of the
Severance Period or (ii) such time as the Executive is covered by
comparable programs of a subsequent employer. Subject to the
provisions of applicable law, if the Executive was participating
in a qualified defined benefit retirement plan prior to a
termination or resignation described in this Section 3, he shall
continue to accrue benefits under such plan during the Severance
Period and, in addition, if the Executive was participating in a
qualified defined contribution retirement plan prior to any such
termination or resignation, he shall continue to so participate
(if he so elects) during the Severance Period, as if he were then
still employed hereunder. During the Severance Period, the
Executive shall also participate, if he so elects, in any
nonqualified retirement plan of the Company or any of its
subsidiaries on the same terms and conditions applicable to
the Executive immediately prior to such termination or
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resignation. Anything herein to the contrary notwithstanding, the
Company shall have no obligation to continue to maintain during
the Severance Period any plan solely as a result of the
provisions of this Agreement. If, during the Severance Period,
the Executive is precluded from participating in a plan by its
terms or applicable law or if the Company for any reason ceases
to maintain such plan, the Company shall provide the Executive
with benefits which are no less favorable in the aggregate to
those which the Executive would have received under such plan had
he been eligible to participate therein or had such plan
continued to be maintained by the Company.
(c) Facilities. During the first six (6) months of the
Severance Period, the Executive will, at his option, be provided
with an office and secretarial services during regular business
hours at a location selected by him subject to the consent of the
Company, which shall not be unreasonably withheld. Except as may
be specifically approved by the Board, the Executive will not be
provided with the use of any other Company facility or services
during the Severance Period or at any time thereafter.
(d) Death. In the event of the Executive's death
subsequent to commencement of the Severance Period, the balance
of the Severance Amount will be paid to his beneficiary in a lump
sum. "Beneficiary" shall mean the person or persons designated by
the Executive in writing to the Company to receive payments under
this Agreement or, if no such person or persons are designated,
the Executive's estate.
(e) Pension Calculations. Notwithstanding any provision
to the contrary herein, pension accruals during the Severance Period
under the cash balance portion of the Company's qualified defined
benefit retirement plan shall be calculated on the actual amounts
paid to the Executive for each applicable plan year of such plan
and calculations under such plan
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based on "average final compensation" shall be calculated during
the Severance Period based on an annual rate of Salary and bonus
equal to one-half (1/2) of the total Severance Amount.
(f) Outplacement Counseling. During the Severance
Period, the Executive will be provided with outplacement
counseling services at Company expense; provided, however, the
expense for such services in any calendar year shall not exceed
eighteen percent (18%) of the Severance Amount paid to the
Executive for such calendar year. This counseling shall include,
but not be limited to, skill assessment, job market analysis,
resume preparation, interviewing skills, job search techniques
and negotiating.
(g) Fringe Benefits. The Company will continue
Executive's participation in the Management Program until the
earlier to occur of (i) the first anniversary of such termination
or resignation or (ii) the date the Executive is covered by
comparable fringe benefit programs and perquisites of a
subsequent employer.
4. Disability. The event of Permanent Disability (as
hereinafter defined) shall not entitle the Executive to any of
the payments or benefits described in Section 3 above unless the
Executive is terminated by the Company other than for Cause or
the Executive resigns for Good Reason. "Permanent Disability"
shall mean physical or mental disability as a result of which the
Executive is unable to perform his duties with the Company on
substantially a full-time basis for any period of six (6)
consecutive months. Any dispute as to whether or not the
Executive is so disabled shall be resolved by a physician
reasonably acceptable to the Executive and the Company whose
determination shall be final and binding upon both the Executive
and the Company.
5. Conditions Applicable to Severance Benefits.
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(a) Confidentiality and Conduct. The Executive warrants
and agrees that he will not disclose to any person, other than the
employees, officers, directors or shareholders of DMPF Holdings
Corporation, a Maryland corporation, or its affiliates and
subsidiaries in connection with the performance of his duties
hereunder, any confidential information or trade secrets
concerning the Company or any of its subsidiaries or affiliates
at any time. Notwithstanding the foregoing, confidential
information and trade secrets shall not be deemed to include,
without limitation, information which (i) is or becomes available
to the public other than as a result of disclosure by the
Executive in violation of this Section 5(a) or (ii) the Executive
is required to disclose under any applicable laws, regulations or
directives of any government agency, tribunal or authority having
jurisdiction in the matter or under subpoena or other process of
law. The Executive will at all times refrain from taking any
action or making any statements, written or oral, which are
intended to and do demonstrably and materially damage the
Company, its subsidiaries and affiliates and their respective
directors, officers or employees. In the event that the Executive
materially violates the terms and conditions of this Section
5(a), the Company may, at its election, upon ten (10) days'
notice, terminate the Severance Period and discontinue payments
of the Severance Amount and cease providing the benefits
described in Section 3 above. The Company may also initiate any
form of legal action it may deem appropriate seeking damages or
injunctive relief with respect to any material violations of this
Section 5(a).
(b) Non-Competition. The Severance Period shall be
terminated and the Company shall have no further obligation to
pay the Severance Amount or to provide the benefits described in
Section 3 above if the Executive, without the Company's written
approval, accepts a position of employment with any other company
conducting a business which is substantially competitive with a
business conducted by the Company.
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(c) No Other Severance Benefits. Except as specifically
set forth in this Agreement, the Executive covenants and agrees that
he shall not be entitled to any other form of severance benefits
from the Company, including, without limitation, benefits
otherwise payable under any of the Company's regular severance
policies, in the event his employment with the Company ends for
any reason and, except with respect to obligations of the Company
expressly provided for herein, the Executive unconditionally
releases the Company and its subsidiaries and affiliates, their
respective directors, officers, employees and stockholders, or
any of them, from any and all claims, liabilities or obligations
under this Agreement or under any severance or termination
arrangement of the Company or any of its subsidiaries or
affiliates for compensation or benefits in connection with his
employment or the termination thereof.
6. General Provisions.
(a) Notices. Any notice hereunder by either party to
the other shall be given in writing by personal delivery, telex,
telecopy or registered mail, return receipt requested, to the
applicable address set forth below:
(i) To the Company: Del Monte Corporation
Xxx Xxxxxx Xxxxx
X.X. Xxx 0000
Xxx Xxxxxxxxx, XX 00000
Attn.: Secretary of the Board
With a Copy to: Xxxxx X. Xxxxxxxxxx, III
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
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(ii) To the Executive: Xxxxx X. Xxxxxx
c/o Del Monte Corporation
Xxx Xxxxxx Xxxxx
X.X. Xxx 0000
Xxx Xxxxxxxxx, XX 00000
(b) Limited Waiver. The waiver by the Company or the
Executive of a violation of any of the provisions of this
Agreement, whether express or implied, shall not operate or be
construed as a waiver of any subsequent violation of any such
provision.
(c) No Assignment. No right, benefit or interest
hereunder shall be subject to assignment, encumbrance, charge,
pledge, hypothecation or set off by the Executive in respect of
any claim, debt, obligation or similar process. This Agreement
and all of the Company's rights and obligations hereunder may be
assigned, transferred or delegated to any business entity which,
at the time of any sale, merger, consolidation or other business
combination, acquires all or substantially all of the assets of
the Company or to which the Company transfers all or
substantially all of its assets, but no such assignment, transfer
or delegation shall impair any rights that the Executive may have
hereunder. Upon such assignment, transfer or delegation, any such
business entity shall be deemed to be substituted for all
purposes as the Company hereunder; provided, however, that no
such assignment, transfer or delegation shall relieve the Company
of its obligations under this Agreement in the event that such
obligations are not performed when due by any such successor to
the Company hereunder.
(d) Amendment. This Agreement may not be amended,
modified or cancelled except by written agreement of the parties.
(e) Severability. In the event that any provision or
portion of this Agreement shall be determined to be invalid or
unenforceable for any reason, the remaining provisions of this
Agreement shall remain in full force and effect to the fullest
extent permitted by law.
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(f) Unsecured Promise. Unless otherwise stated herein,
no benefit or promise hereunder shall be secured by any specific
assets of the Company. Unless otherwise stated herein, the
Executive shall have only the rights of an unsecured general
creditor of the Company in seeking satisfaction of such benefits
or promises.
(g) Governing Law. This Agreement has been made in and shall
be governed by and construed in accordance with the laws of the
State of New York.
(h) Entire Agreement. This Agreement sets forth the entire
agreement and understanding of the parties hereto with respect to
the matters covered hereby.
(i) Headings. The headings and captions of the
Sections of this Agreement are included solely for convenience of
reference and shall not control the meaning or interpretation of
any provisions of this Agreement.
(j) Counterparts. This Agreement may be executed by
the parties hereto in counterparts, each of which shall be deemed
an original, but both such counterparts shall together constitute
one and the same document.
IN WITNESS WHEREOF, the parties have executed this
Agreement effective as of the day and year first written above.
DEL MONTE CORPORATION
By: /s/ Xxxxx X. Xxxxxx
-----------------------
Sr. Vice President,
Administration
/s/ Xxxxx X. Xxxxxx
-----------------------
Xxxxx X. Xxxxxx
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