Contract
Exhibit 10.4
THIS
EXECUTIVE CONFIDENTIALITY AND RESTRICTIVE COVENANT AGREEMENT (the “Agreement”)
is entered into as of February 13, 2008 (the “Effective Date”), between The
Hershey Company, a Delaware corporation together with its subsidiaries and
affiliates and its and their respective successors and assigns (“Employer”), and
___________________ (“Executive”).
WHEREAS,
Executive currently serves, or is being hired or promoted to serve, in an
E-grade level position with Employer.
WHEREAS,
Employer possesses certain valuable confidential, proprietary and/or trade
secret information (collectively, “Confidential Information,” as further defined
below) that gives Employer a competitive advantage.
WHEREAS,
Employer has developed and maintained, at substantial expense and over a
considerable period of time, relationships with customers, suppliers, agents,
licensees, licensors and others that likewise give Employer a competitive
advantage (“Business Relationships”).
WHEREAS,
as a result of Executive’s past, future, and/or continued employment in an
E-grade level position with Employer, Executive has been and/or will continue to
be given access to, and will assist in, the development and maintenance of
Employer’s Confidential Information and Business Relationships, and it is the
parties’ intent to continue to safeguard such Confidential Information and
Business Relationships both during and after the term of Executive’s employment
with Employer.
WHEREAS,
Employer’s reputation and present and future competitive position are dependent
upon Employer’s ability to protect its interests in such Confidential
Information and Business Relationships.
NOW,
THEREFORE, in consideration of (i) Employer employing Executive in an E-grade
level position with Employer, (ii) Employer providing and continuing to provide
Executive access to such Confidential Information and Business Relationships,
(iii) Employer providing and continuing to provide Executive access to
specialized training, (iv) Employer making an award of performance stock units
(“PSUs”) to Executive under the 2008-2009 PSU cycle (the “2008-2009 PSU award”),
(v) Employer permitting Executive to participate in and defer the 2008-2009 PSU
award into the Deferred Compensation Plan of Employer, and/or (vi) for other
good and valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, Employer and Executive agree as follows:
1. Non-Disclosure of
Confidential Information. Executive acknowledges that due to
the nature of his/her employment and the position of trust that he/she holds or
will hold with Employer, he/she will have special access to, learn, be provided
with, and in some cases will prepare and create for Employer, trade secrets and
other confidential and proprietary information relating to Employer’s business,
including, but not limited to,
information
about Employer’s manufacturing processes; manuals, recipes and ingredient
percentages; engineering drawings; product and process research and development;
new product information; cost information; supplier data; strategic business
information; information related to Employer’s legal strategies or legal advice
rendered to Employer; marketing, financial and business development information,
plans, forecasts, reports and budgets; customer information; new product
strategies, plans and project activities; and acquisition and divestiture
strategies, plans and project activities (collectively, “Confidential
Information”). Executive acknowledges and agrees that Confidential
Information, whether or not in written form, is the exclusive property of
Employer, that it has been and will continue to be of critical importance to the
business of Employer, and that the disclosure of it to, or use of it by,
competitors and others will cause Employer substantial and irreparable
harm. Accordingly, Executive will not, either during his/her
employment or at any time after the termination (whether voluntary or
involuntary, and regardless of reason) of such employment with Employer, use, or
disclose any Confidential Information relating to the business of Employer which
is not generally available to the public. Notwithstanding the
foregoing provisions of this Paragraph 1, Executive may disclose or use any such
information (i) when such disclosure or use may be required or appropriate
in the good faith judgment of Executive in the course of his/her employment with
Employer, (ii) when required by a court of law, by any governmental agency
having supervisory authority over Executive or the business of Employer, or by
any administrative or legislative body (including a committee thereof) with
apparent jurisdiction, or (iii) with the prior written consent of
Employer’s Chief Executive Officer (“CEO”) or Board of Directors (“Board”)
(provided that, if Executive is CEO, such consent must be by the
Board). Executive understands and agrees that his/her obligations
under this Agreement shall be in addition to, rather than in lieu of, any
obligations Executive may have under any applicable statute or at common
law.
2. Non-Competition. Executive
acknowledges that Employer is engaged in the business of developing, producing,
marketing, selling and distributing confectionery, snack, better-for-you and
balanced nutrition products and chocolate-related grocery products (“Employer’s
Business”). Executive acknowledges that due to the nature of his/her
employment with Employer, he/she has and will have special access to, contact
with, and Confidential Information about, Employer’s Business and Business
Relationships. Executive acknowledges that Employer has incurred
considerable expense and invested considerable time and resources in developing
its Business Relationships, and that those Business Relationships are critical
to the success of Employer’s business. Accordingly, both (i) during
the term of his/her employment with Employer, and (ii) for a period of twelve
(12) months following the termination of his/her employment (whether voluntary
or involuntary, and regardless of reason), Executive, except in the performance
of his/her duties to Employer, shall not, in any geographic area where Employer
conducts business, without the prior written consent of Employer’s CEO or Board
(provided that, if Executive is CEO, such consent must be by the Board),
directly or indirectly serve or act as an officer, director, employee,
consultant, advisor, independent contractor, agent or representative for the
domestic or worldwide confectionery, snack, better-for-you, balanced nutrition,
or chocolate-related grocery businesses of any person or entity that is in
competition with any of the aspects of Employer’s Business. For purposes of
clarification, Executive will not be deemed to be involved in a business in
competition
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with
Employer’s Business, and accordingly this paragraph 2 will not be violated, by
the Executive (A) providing services to a subsidiary, division or unit of an
entity (a “parent company”) that engages, directly or indirectly, in any
competitive business described above, so long as Executive and the subsidiary,
division or unit to which he/she is providing services do not engage in any such
competitive business, or (B) serving at the corporate level of a parent company
that engages, directly or indirectly, in any competitive business described
above, so long as the gross revenues from such competitive businesses
constituted less than 10% of consolidated annual gross revenues for the parent
company’s most recently completed fiscal year.
3. Non-Solicitation;
Non-Disparagement. Both (i) during the term of his/her
employment by Employer, and (ii) for a period of 12 months following the
termination of his/her employment (whether voluntary or involuntary, and
regardless of reason), Executive, except in the performance of his/her duties to
Employer, shall not directly or indirectly (including as an officer, director,
employee, consultant, advisor, agent or representative), for himself/herself or
on behalf of any other person or entity:
(a) knowingly
recruit or solicit, or participate in recruiting or soliciting, any of
Employer’s employees, or communicate, except in the case of a reference
described in the last sentence of this paragraph, to any other person or entity
about the nature, quality or quantity of work, or any special knowledge or
personal characteristics, of any person employed by Employer. If
Executive should wish to discuss possible employment with any then-current
employee of Employer during the period set forth above, Executive may request
written permission to do so from the most senior human resources officer of
Employer who may, in his/her discretion, grant a written exception to the no
solicitation covenant set forth immediately above; provided, however, Executive
shall not discuss any such employment possibility with any such employee prior
to such permission. Notwithstanding the foregoing, the provisions of
this paragraph shall not be violated by (i) general advertising or solicitation
not specifically targeted at employees of Employer, (ii) Executive serving as a
reference, upon request, for any employee of Employer, or (iii) actions taken by
any person or entity with which Executive is associated if Executive is not
personally involved in any manner in the matter and has not identified such
employee for recruiting or solicitation; or
(b) make any
public statements that disparage Employer, its employees, officers,
directors, products or services, provided that, notwithstanding the
foregoing, truthful statements made in the course of sworn testimony in
administrative, judicial or arbitral proceedings (including, without limitation,
depositions in connection with such proceedings), normal competitive-type
statements, and statements made in the good faith performance of the Executive’s
duties to Employer shall not be subject to this clause.
4. Violation of Paragraphs 1, 2
or 3. Executive acknowledges Employer’s valid and protectable
interest in aligning the long-term interests of valued employees with those of
Employer by providing Executive an ownership interest in the Employer through
the 2008-2009 PSU award and otherwise, and likewise acknowledges Employer’s
valid and protectable interest in preventing former employees whose interests
become adverse
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to the
Employer from maintaining an ownership or other interest in the
Employer. Accordingly, Executive agrees that if he/she violates any
of paragraphs 1, 2 or 3 above (the date on which any such violation occurs is
the “Date of Breach”), Employer may, in its sole discretion, in addition to any
other remedies available to it at law or in equity: (a) cancel any
unvested portion of the 2008-2009 PSU award; (b) require Executive to pay
Employer the full value of any portion of the 2008-2009 PSU award that vested
within the twelve (12) months immediately preceding the Date of Breach; and/or
(c) require Executive to pay Employer the value of all gains on any portion of
the 2008-2009 PSU award that were realized within the twelve (12) month period
immediately preceding the Date of Breach.
5. Entire
Agreement. Executive acknowledges and agrees that (a) this
Agreement includes the entire agreement and understanding between the parties
with respect to the subject matter hereof, and may be amended, modified or
changed only by a written instrument executed by Executive and Employer, and (b)
violation of paragraphs 1, 2 or 3 hereof may cause Executive to lose the right
to receive, or may obligate Executive to repay to Employer, amounts awarded or
accrued under various plans and programs of Employer as described in paragraph 4
and that, to the extent any effect of this Agreement upon such amounts may be
inconsistent with the terms and conditions of such plans or programs as in
effect on the date hereof, this Agreement shall constitute an amendment of such
terms and conditions and Executive’s consent thereto. No provision of
this Agreement may be waived except by a writing executed and delivered by the
party sought to be charged. Any such written waiver will be effective
only with respect to the event or circumstance described therein and not with
respect to any other event or circumstance, unless such waiver expressly
provides to the contrary. Notwithstanding the foregoing, this
Agreement shall not supersede the provisions of Section 3 of the Long-Term
Incentive Program Participation Agreement to which Executive may be a party
insofar as the terms thereof apply to awards and amounts other than the
2008-2009 PSUs.
6. Miscellaneous.
(a) This
Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania, without reference to
principles of conflict of laws.
(b)
All
notices and other communications hereunder shall be in writing; shall be
delivered by hand delivery to the other party or mailed by registered or
certified mail, return receipt requested, postage prepaid or by a nationally
recognized courier service such as Federal Express; shall be deemed delivered
upon actual receipt; and shall be addressed as follows:
If to
Employer:
The
Hershey Company
000
Xxxxxxx X Xxxxx
Xxxxxxx,
Xxxxxxxxxxxx 00000
ATTN: Vice
President, Total Compensation and Benefits
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If to
Executive:
At the
address set forth with the signature below,
or to
such other address as either party shall have furnished to the other in writing
in accordance herewith.
(c) Any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction will, as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction will
not invalidate or render unenforceable such provision in any other
jurisdiction.
IN
WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as
of the date first set forth above.
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EXECUTIVE:
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_______________________________________
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_______________________________________
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_______________________________________
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EMPLOYER:
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The
Hershey Company, a Delaware corporation
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________________________________
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_____________________________
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