FORM OF U.S. CHANGE IN CONTROL SEVERANCE PROTECTION AGREEMENT
EXHIBIT 10(m)
Dated: 8/1/2011
FORM OF U.S.
CHANGE IN CONTROL
SEVERANCE PROTECTION AGREEMENT
CHANGE IN CONTROL
SEVERANCE PROTECTION AGREEMENT
THIS AGREEMENT made as of <DATE>, by and between Xxxxxxxx Soup Company (the “Company”)
and <NAME> (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 <DATE>,
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 that occurs
prior to the end of the term.
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
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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 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 August 1, 2011, 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.
(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
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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 (notwithstanding accommodation)
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 by a material amount 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 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);
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(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 6 hereof.
(b) (1) A Good Reason termination shall not occur unless the Executive gives
notice to the Company that an event or condition described in Sections 2.4(a) (1)
through (7) has occurred within a time period not to exceed ninety (90) days from
the date of first occurrence of one of these events or conditions, and the Company
shall have at least thirty (30) days from the time of that notice in which to remedy
the event or condition described in Sections 2.4(1) through (7).
(2) 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 Annual Incentive Plan for the
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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 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 401(k)
Retirement Plan and the Xxxxxxxx Soup Company Supplemental Retirement 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 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 Company’s long-term incentive plans 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 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.
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(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 Group
Change in Control 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 8. 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 purchaser or acquiror as contemplated in
Section 6(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 or (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.
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6. 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.
(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.
7. 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.
8. Order of Payment. In the event that the severance and other benefits provided for in this
Agreement or otherwise payable to you (i) constitute “parachute payments” within the meaning of
Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and (ii) but for this
provision, would be subject to the excise tax imposed by Section 4999 of the Code, then Executive’s
severance, vesting and other benefits under this Agreement shall be payable either (i) in full, or
(ii) as to such lesser amount which would result in no portion of such severance and other benefits
being subject to the excise tax under Section 4999 of the Code, whichever of the foregoing amounts,
taking into account the applicable federal, state and local income taxes and the excise tax imposed
by Section 4999, results in the receipt by you on
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an after-tax basis, of the greatest amount of
severance benefits under this Agreement notwithstanding that all or some portion of such severance
benefits may be taxable under Section 4999 of the Code. Any reduction shall be made in the
following manner: first a pro rata reduction of (i) cash payments subject to Section 409A of the
Code as deferred compensation and (ii) cash payments not subject to Section 409A of the Code, and
second a pro rata cancellation of (i) equity-based compensation subject to Section 409A of the Code
as deferred compensation and (ii) equity-based compensation not subject to Section 409A of the
Code. Reduction in either cash payments or equity compensation benefits shall be made prorata
between and among benefits which are subject to Section 409A of the Code and benefits which are
exempt from Section 409A of the Code. Unless the Company and you otherwise agree in writing, any
determination required under this provision shall be made in writing by the Company’s independent
public accountants (the “Accountants”), whose determination shall be conclusive and binding upon
you and the Company for all purposes. For purposes of making the calculations required by this
provision, the Accountants may make reasonable assumptions and approximations concerning applicable
taxes and may rely on reasonable, good faith interpretations concerning the application of Sections
280G and 4999 of the Code. The Company and you shall furnish to the Accountants such information
and documents as the Accountants may reasonably request in order to make a determination under this
provision. The Company shall bear all costs the Accountants may reasonably incur in connection with
any calculations contemplated by this provision.
9. 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.
10. 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.
11. 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, recoupment, defense or
other right which the Company may have against the Executive or others.
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12. Xxxxxxxxxxxxx.Xx 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.
13. 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.
14. 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.
15. 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.
16. 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.
17. 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.
18. 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.
19. 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.
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.
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| ATTEST: | Xxxxxxxx Soup Company | |||||
By: |
||||||
| By: | ||||||
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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 46 — 48 50 and above |
1.5 2.0 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 46 — 48 50 and above |
18 months 24 months 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 46 — 48 50 and above |
18 months 24 months 30 months |
Page 13 of 13
