STOCK OPTION AGREEMENT
CONAGRA FOODS, INC.
Stock Option Agreement, hereinafter referred to as the "Option" or the
"Agreement" made on the 31st day of August, 2005, between ConAgra Foods, Inc., a
Delaware Corporation (the "Company") and the Optionee.
1. Grant of Option. The Company hereby grants an Option on shares of the
Company's common stock ("Common Stock") to the Optionee, as follows:
Optionee: XXXX X. XXXXXX
Number of Shares: 1,000,000
Exercise Price Per Share: $22.83
Date of Grant: August 31, 2005
Plan Name: The ConAgra 2000 Stock Plan
Type of Option: Nonstatutory
2. Definitions: Terms not otherwise defined herein shall have the meanings
ascribed to them in an Employment Agreement between the Company and the Optionee
dated effective as of August 31, 2005 (the "Employment Agreement").
IN WITNESS WHEREOF, the Company and the Optionee have caused this Agreement
to be executed effective as of the date first written above. The Company and the
Optionee acknowledge that this Agreement includes seven pages including this
page. The Optionee acknowledges reading and agreeing to all seven pages.
CONAGRA FOODS, INC. OPTIONEE
By: /s/ Xxxx X. Xxxxxxxxx /s/ Xxxx X. Xxxxxx
---------------------------- ---------------------------
Chairman, Human Resources Committee XXXX X. XXXXXX
3. Exercise of Option. This Option shall be vested and exercisable with
respect to forty percent (40%) of such options on May 27, 2007; an additional
thirty percent (30%) of such options on May 25, 2008; and the balance of such
options on May 31, 2009. All such installments shall vest and be exercisable
from the commencement date thereof and ending ten years after the date of this
Agreement, all in accordance with the terms of this Agreement; in the event of
Change of Control, the Option granted pursuant to this Agreement shall become
immediately exercisable with respect to the full number of shares subject to
this Option. The Option shall be subject to the following:
(a) Right to Exercise. This Option shall be exercisable during the
term of the Option, by the Optionee:
(i) while the Optionee is in Continuous Employment with the Company;
(ii) for a period ending 90 days after the Optionee's Continuous
Employment terminates for any reason, except as provided in (v)
and (vi) below. The options that may be exercised are those that
are vested at the time such termination of employment occurs;
(iii) for a period ending three (3) years after the Optionee qualifies
for and takes Early Retirement. The options that may be exercised
are those that are vested at the time Early Retirement occurs;
(iv) for a period ending three (3) years after the Optionee's Normal
Retirement from Continuous Employment with the Company;
(v) In the event of Optionee's death, Permanent Disability,
termination by the Company without Cause, or voluntary
termination of employment by Optionee with Good Reason, this
Option shall become fully vested and exercisable during the
remainder of the term of the Option; and
(vi) In the event the Company terminates the employment of the
Optionee with Cause, this Option shall terminate and all
unexercised options shall lapse.
(b) Method of Exercise. This Option shall be exercisable by a written
notice which shall:
(i) state the election to exercise the Option, the number of shares
in respect of which it is being exercised, the person in whose
name the stock certificate or certificates for such shares of
Common Stock is to be registered, his/her address and social
security number;
(ii) be signed by the person or persons entitled to exercise the
Option and, if the Option is being exercised by any person or
persons other than the Optionee, be accompanied by proof
satisfactory to counsel for the Company of the right of such
person or persons to exercise the Option. Payment of the purchase
price of any shares with respect to which the Option is being
exercised shall be by check, and shall be delivered with notice
of exercise; provided, however, at the election of the Optionee,
the amount equal to the purchase price may be paid, in whole or
in part, in Common Stock of the Company valued at fair market
value (as defined in the Plan).
(c) Restrictions on Exercise. As a condition to exercise of this
Option, the Company may require the person exercising this Option to make
any representation and warranty to the Company as may be required by any
applicable law or regulation.
(d) Payment of Taxes Upon Exercise. As a condition of the issuance of
shares hereunder, the Optionee agrees to remit to the Company at the time
of exercise of this Option any taxes required to be withheld by the Company
under Federal, state or local law as a result of the exercise. The Optionee
may remit such amount by check or by a reduction of the number of shares to
be delivered to the Optionee upon exercise.
4. Cancellation of Options. Except as otherwise provided herein, upon the
Optionee's termination of employment, unvested options shall immediately cancel
and any vested options not exercised during the exercise period set forth in
Paragraph 3(a) shall be cancelled at the end of the exercise period.
5. Non-Transferability of Option. Except as may otherwise be permitted by
the Human Resources Committee of the Board of Directors, this Option may not be
assigned, transferred, pledged or hypothecated in any manner (otherwise than by
will or the laws of descent or distribution) nor may the Optionee enter into any
transaction for the purpose of, or which as the effect of, reducing the market
risk of holding the option by using puts, calls or similar financial techniques.
This Option may be exercised during the lifetime of the Optionee only by the
Optionee. The terms of this Option shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.
6. Stock Subject to the Option. If the Option should expire or become
unexercisable for any reason without having been exercised in full, any
unpurchased shares which were subject thereto shall once again be subject to the
grant of an Option pursuant to the Plan. The Company will not be required to
issue or deliver any certificate or certificates for shares to be issued
hereunder until such shares have been listed (or authorized for listing upon
official notice of issuance) upon each stock exchange on which outstanding
shares of the same class are then listed and until the Company has taken such
steps as may, in the opinion of counsel for the Company, be required by law and
applicable regulations, including the rules and regulations of the Securities
and Exchange Commission, and State Securities laws and regulations, in
connection with the issuance or sale of such shares, and the listing of such
shares on each such exchange. The Company will use its best efforts to comply
with any such requirements.
7. Adjustments Upon Changes in Capitalization. If all or any portion of the
Option is exercised subsequent to any stock dividend, upon subdivision,
split-up, combination or reclassification of the Common Stock or a merger or
consolidation involving the Company, the Human Resources Committee of the Board
of Directors shall make equitable adjustment in the number of shares subject to
this Option and adjustment in the per share Option Price, provided, however,
that no fractional share shall be issued upon subsequent exercise of the Option
and the aggregate price paid shall be appropriately reduced on account of any
fractional share not issued.
8. Notices. Each notice relating to this Agreement shall be in writing.
Each notice shall be deemed to have been given on the date it is received. Each
notice to the Company shall be addressed to its principal office in Omaha,
Nebraska, attention to Corporate Compensation. Each notice to the Optionee or
any other person or persons entitled to exercise the Option shall be addressed
to the Optionee's address as shown on the Company's records. Anyone to whom a
notice may be given under this Agreement may designate a new address by notice
to the effect.
9. Benefits of Agreement. This Agreement shall inure to the benefit of and
be binding upon each successor of the Company. All obligations imposed upon the
Optionee and all rights granted to the Company under this Agreement shall be
binding upon the Optionee's heirs, legal representatives and successors. This
Agreement shall be the sole and exclusive source of any and all rights which the
Optionee, his heirs and legal representatives or successors may have in respect
to the Plan or any Options or Common Stock granted or issued thereunder whether
to himself or to any other person.
10. Resolution of Disputes. Any dispute or disagreement which should arise
under or as a result of or in any way related to the interpretation,
construction or application of this Agreement will be determined by the Human
Resources Committee of the Board of Directors. Any determination made hereunder
shall be final, binding and conclusive for all purposes. This Agreement and the
legal relations between the parties hereto shall be governed by and construed in
accordance with the laws of the state of Nebraska.
11. Definitions.
(a) Change of Control. Change of Control shall mean:
(i) the acquisition (other than from the Company) by any person,
entity or "group," within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange
Act"), (excluding, for this purpose, the Company or its
subsidiaries, or any employee benefit plan of the Company or its
subsidiaries which acquires beneficial ownership of voting
securities of the Company) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 30%
or more of either the then outstanding shares of common stock or
the combined voting power of the Company's then outstanding
voting securities entitled to vote generally in the election of
directors; or
(ii) individuals who, as of the date hereof, constitute the Board (as
of the date hereof the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board, provided that any
person becoming a director subsequent to the date hereof whose
election, or nomination for the election by the Company's
shareholders, was approved by a vote of at least a majority of
the directors then comprising the Incumbent Board shall be, for
purposes of this Agreement, considered as though such person were
a member of the Incumbent Board; or
(iii) consummation of a reorganization, merger or consolidation, in
each case, with respect to which persons who were the
stockholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately
thereafter, own more than 50% of the combined voting power
entitled to vote generally in the election of directors of the
reorganized, merged or consolidated company's then outstanding
voting securities, or a liquidation or dissolution of the Company
or of the sale of all or substantially all of the assets of the
Company.
(b) Continuous Employment with the Company. Continuous Employment with
the Company shall mean the absence of any interruption or termination of
employment by the Company or any parent or subsidiary of the Company which
now exists or hereafter is organized or acquired by the Company. Continuous
Employment shall not be considered interrupted in the case of sick leave,
Long Term Disability, military leave or any other leave of absence approved
by the Company or in the case of transfers between payroll locations of the
Company or between the Company, its parent or subsidiaries or its
successor.
(c) Normal Retirement. Normal Retirement shall mean terminating
employment with the Company or its subsidiaries on or after attaining age
65.
(d) Early Retirement. Early Retirement shall mean (1) qualifying for
and taking early retirement under a pension plan (as defined in ss. 3(2) of
the Employee Retirement Income Security Act of 1974, as amended) that is
sponsored by the Company or its subsidiaries or (2) becoming Retiree
Eligible as a result of Continuous Employment to the fifth anniversary of
the date of the Employment Agreement. If the Optionee's employer does not
have a pension plan, then the Company's salaried pension plan provisions
for Early Retirement shall apply, which provide that the Optionee must (a)
be at least age 55, and (b) have at least ten years of Continuous
Employment with the Company.
