EMPLOYMENT AGREEMENT
AGREEMENT made by and between ConAgra, Inc., a Delaware
corporation ("Company"), and Xxxxx Xxxxx ("Executive") effective
as of the 26th day of August, 1996.
The Board of Directors of the Company ("Board") has
determined that it is in the best interests of the Company to
obtain and retain the services of Executive and to induce
Executive to leave his current position in order to accept a
position with the Company. In order to accomplish this
objective, the Board has caused the Company to enter into this
Agreement.
NOW, THEREFORE, it is agreed as follows:
1. Term of Employment. Executive's term of employment
under this Agreement shall commence on August 26, 1996
("Effective Date") and shall continue in accordance with the
terms hereof until a termination of Executive's employment.
2. Position and Duties.
2.1 Position. The Company employs Executive as
President of the Company. The Board has elected Executive as
Vice Chairman of the Board and a member of the Executive
Committee of the Board. Executive shall have the customary
powers, responsibilities and authorities of presidents of
corporations of the size, type and nature of the Company.
Executive's office shall be at the principal executive offices of
the Company in Omaha, Nebraska.
2.2 Duties. Executive shall devote his full working
time and efforts to the performance of the duties outlined above.
Executive may, consistent with his duties hereunder, engage in
charitable and community affairs, manage his personal investments
and (subject to the prior approval of the Board) serve on the
board of directors of other companies.
3. Compensation.
3.1 Base Salary. The Company shall pay Executive a
Base Salary ("Base Salary") at the rate of $750,000 per annum.
The base salary shall be payable in accordance with the ordinary
payroll practices of the Company. Executive's rate of Base
Salary shall be reviewed for possible increases by the Board at
least annually.
3.2 Annual Incentive Bonus. Executive shall be
entitled to receive an annual bonus under the Company's Executive
Annual Incentive Plan ("Annual Bonus Plan"), or any successor
plan subsequently available to senior executive officers.
Executive's target bonus opportunity under the Annual Bonus Plan
shall not be less than 80% of Executive's Base Salary. The
performance goals with respect to such target bonus opportunity
shall be established annually by the Board on a basis consistent
with the establishment of such performance goals for other senior
executive officers of the Company.
3.3 Long Term Senior Management Incentive Plan.
Executive shall participant in Company's Long Term Senior
Management Incentive Plan ("LTSMIP"). Executive shall receive
three units in the LTSMIP for fiscal year 1997; provided, any
payments to Executive for fiscal 1997 shall be prorated and based
on Executive's employment from the Effective Date to the end of
the fiscal year. Executive's participation in the LTSMIP shall
increase (i) to four units for fiscal year 1998 and (ii) to six
units at such time as Executive becomes Chief Executive Officer
of ConAgra.
3.4 Restricted Stock Grant. Pursuant to the Company's
1995 Stock Plan, the Human Resources Committee of the Board
("Committee") has granted to Executive an award of 100,000
restricted shares of Company common stock on the Effective Date.
Such shares shall vest at the rate of 10% on the last day of each
fiscal year of the Company, with the first 10% vesting on the
last day of fiscal 1997.
3.5 Stock Option Grant. Pursuant to the Company's
1995 Stock Plan, the Committee has granted to Executive on the
Effective Date options to acquire 100,000 shares of Company
common stock. The exercise price of such options is $43.00 per
share, the closing price of the Company's common stock on the New
York Stock Exchange on the date of grant. Such options shall
vest and become exercisable at the rate of 20% per year on the
last day of each fiscal year of the Company, with the first 20%
becoming vested and exercisable on the last day of fiscal 1997.
4. Other Benefits.
4.1 Employee Benefit Plans. The Company shall provide
Executive with coverage under all employee benefit programs,
plans and practices, in accordance with the terms thereof, which
the Company makes available to senior executive officers.
4.2 Pension Credit. At such time as Executive becomes
Chief Executive Officer of the Company, Executive shall be
credited with sufficient prior years of service for purposes of
determining Executive's benefit payable under the Company's
supplemental pension and related benefit plans so that Executive
would have 25 years of service if Executive remained employed by
the Company until age 65.
4.3 Directors and Officers Liability Coverage.
Executive shall be entitled to the same coverage under the
Company's directors and officers liability insurance policies as
is available to senior executive officers and directors with the
Company. In any event, the Company shall indemnify and hold
Executive harmless, to the fullest extent permitted by the laws
of the State of Delaware, from and against all costs, charges and
expenses (including reasonable attorneys' fees) incurred or
sustained in connection with any action, suit or proceeding to
which Executive or his legal representatives may be made a party
by reason of Executive's being or having been a director or
officer of the Company or any of its affiliates. The provisions
of this subparagraph shall survive the termination of this
Agreement for any reason.
4.4 Expenses. Executive is authorized to incur
reasonable expenses in carrying out his duties under this
Agreement, including expenses for travel and similar items
related to such duties. The Company shall reimburse Executive
for all such expenses upon presentation by Executive from time to
time of an itemized account of such expenditures.
5. Termination of Employment. The Company may terminate
Executive's employment at any time for any reason, and Executive
may terminate his employment at any time for Good Reason, subject
to the terms of this Section 5. For purposes of this Section 5,
the following terms shall have the following meanings:
(a) "Cause" shall be limited to (i) action by Executive
involving willful malfeasance in connection with his
employment having a material adverse effect on the
Company, (ii) substantial and continuing refusal by
Executive in willful breach of this Agreement to
perform the duties ordinarily performed by an executive
occupying his position, which refusal has a material
adverse effect on the Company, or (iii) Executive being
convicted of a felony involving moral turpitude under
the laws of the United States or any state.
(b) "Good Reason" shall mean (i) the assignment to
Executive of duties materially inconsistent with
Executive's position or any removal of Executive from,
or failure to elect or reelect Executive to, the
position of President of the Company and Vice Chairman
of the Board of Directors (or other position as may be
agreed to by Executive), except in any case in
connection with the termination of Executive's
employment for Cause, Permanent Disability, death, or
voluntary termination by Executive without Good Reason,
(ii) a reduction of Executive's Base Salary or annual
target bonus opportunity as in effect on the Effective
Date or as the same may be increased from time to time,
(iii) any material breach by the Company of any
provision of this Agreement, (iv) a requirement that
Executive be based at any office or location other than
Omaha, Nebraska at any time within four years following
the Effective Date or (v) a Change of Control of the
Company occurs.
(c) "Change of Control" shall have the meaning provided in
the Conditional Employment Agreement between the
Company and Executive dated of even date herewith.
(d) "Permanent Disability" shall mean the permanent
disability of Executive as defined under the Company's
Long-Term Disability Plan.
5.1 Termination Upon Death or Permanent Disability.
In the event Executive's employment with the Company is
terminated by reason of Executive's death or Permanent Disability
(i) all restrictions on previously-granted restricted stock
awards shall lapse and such shares shall become fully vested,
(ii) all options previously granted to Executive in connection
with the LTSMIP shall become fully vested and exercisable during
the remainder of the term of such options, and all then vested
options granted in accordance with Section 3.5 above shall remain
exercisable during the full term of such options, (iii) all
deferred and other amounts previously accrued for the benefit of
Executive shall be promptly paid to Executive's estate or
designated beneficiary (the items in (i), (ii) and (iii) above
are collectively referred to as the "Accrued Benefits"), (iv)
Executive and his dependents shall continue to participate in the
Company's employee benefit plans to the extent provided in such
plans with respect to the death or Permanent Disability of senior
executive officers of the Company, (v) Executive's Base Salary
shall be paid through the month of death or Permanent Disability
and (vi) Executive shall receive a benefit under the Annual Bonus
Plan and the LTSMIP prorated for the fiscal year during which
Executive died or became Permanently Disabled.
5.2 Termination Without Cause or for Good Reason. If
the Company terminates the employment of Executive without Cause,
or if Executive voluntarily terminates employment with Good
Reason, (i) Executive shall receive all Accrued Benefits, (ii)
Executive and his dependents shall continue to participate in the
Company's medical and dental programs for a period of 24 months
at no cost to Executive, (iii) Executive's Base Salary shall
continue for a period of 24 months following such termination,
and (iv) in the event of a termination for Good Reason on account
of a Change of Control, Executive shall receive the benefits
described in the Conditional Employment Agreement of even date
herewith (reduced to the extent the Base Salary benefit in (iii)
above is duplicative of a similar benefit under such Conditional
Employment Agreement).
5.3 Termination With Cause or Without Good Reason. If
the Company terminates the employment of Executive with Cause, or
if Executive voluntarily terminates employment with the Company
without Good Reason, then (i) Executive shall be paid the Base
Salary through the month of termination, and (ii) Executive shall
receive benefits, if any, under Company plans in accordance with
the terms of such plans.
5.4 Timing of Payments. All cash payments required
hereunder following the termination of Executive's employment
shall be made within fifteen days following such termination;
provided, that cash payments under the Annual Bonus Plan or the
LTSMIP shall be made following the end of the applicable fiscal
year at the same time as such payments are made to the Company's
other senior executive officers participating in such plans.
6. Nondisclosure of Confidential Information. Executive
shall not, without the prior written consent of the Company,
disclose any Company Confidential Information except (i) in the
business of and for the benefit of the Company, while employed by
the Company, or (ii) when required to do so by a court of
competent jurisdiction, by any administrative body or legislative
body. "Confidential Information" shall mean non-public
information concerning the Company's financial data, strategic
business plans, product development and other proprietary
information, except for items which have become publicly
available information or are otherwise known to the public.
Confidential Information does not include information the
disclosure of which could not reasonably be expected to adversely
affect the business of the Company.
7. Noncompetition. From the Effective Date through a
period ending two years following the termination of the
employment of Executive with the Company for any reason,
Executive shall not be an executive officer, board member, 5% or
greater owner or partner, or employee of a food company with
revenues over $1 billion. Executive agrees that any breach of the
covenants contained in this Section 7, and the covenants
contained in the preceding Section 6, will irreparably injure the
Company, and accordingly the Company may, in addition to pursing
any other remedies available at law or in equity, obtain an
injunction against Executive from any court having jurisdiction
over the matter, restraining any further violation of such
provisions by Executive.
Executive acknowledges and agrees that the provisions of
this Section 7 are reasonable and valid in duration and scope and
in all other respects. If any court determines that any
provision of this Section is unenforceable because of duration or
scope of such provision, such court shall have the power to
reduce the scope or duration of such provision, as the case may
be, and, in its reduced form, such provision shall then be
enforceable.
8. Offsets. In the event of any breach of this Agreement,
Executive shall not be required to mitigate damages nor shall the
payments due Executive hereunder be reduced or offset by reason
of any payments Executive may receive from any other source.
9. Separability; Legal Fees. If any provision of this
Agreement shall be declared to be invalid or unenforceable, in
whole or in part, such invalidity or unenforceability shall not
affect the remaining provisions hereof which shall remain in full
force and effect. In addition, the Company shall pay to
Executive as incurred all legal and accounting fees and expenses
incurred by Executive in seeking to obtain or enforce any right
or benefit provided by this Agreement or any other compensation-
related plan, agreement or arrangement of the Company, unless
Executive's claim is found by a court of competent jurisdiction
to have been frivolous.
10. Assignment. This Agreement shall be binding upon and
inure to the benefit of the heirs and representatives of
Executive and the assigns and successors of the Company, but
neither this Agreement nor any rights hereunder shall be
assignable or otherwise subject to hypothecation by Executive
(except by will or by operation of the laws of intestate
succession) or the Company, except that the Company may assign
this Agreement to any successor (whether by merger, purchase or
otherwise) to all or substantially of the stock, assets or
businesses of the Company.
11. Amendment. This Agreement may only be amended by
mutual written agreement between the Company and Executive.
12. Notices. All notices or communications hereunder shall
be in writing, addressed as follows:
To the Company: ConAgra, Inc.
Xxx XxxXxxx Xxxxx
Xxxxx, Xxxxxxxx 00000
Attn: Secretary
To Executive: Xxxxx Xxxxx
000 Xxxxx 00xx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Any such notice or communication shall be sent certified or
registered mail, return receipt requested, postage prepaid,
addressed as above (or to such other address as such party may
designate in a notice duly delivered as described above), and the
actual date of mailing shall determine the date at which notice
was given.
13. Governing Law. This Agreement shall be construed,
interpreted and governed in accordance with the laws of Delaware
without reference to such state's rules relating to conflicts of
law.
CONAGRA, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
____________________________
Chairman, Board of Directors
/s/ Xxxxx Xxxxx
________________________________
Xxxxx Xxxxx
AGREEMENT
Agreement made effective this 26th day of August, 1996, by
and between ConAgra, Inc., a Delaware corporation, hereinafter
referred to as "ConAgra", and XXXXX XXXXX, hereinafter referred
to as "Employee".
WHEREAS, the Board of Directors of ConAgra has determined
that the interests of ConAgra stockholders will be best served by
assuring that all key corporate executives of ConAgra will adhere
to the policy of the Board of Directors with respect to any event
by which another entity would acquire effective control of
ConAgra, including but not limited to a tender offer, and
WHEREAS, the Board of Directors has also determined that it
is in the best interests of ConAgra stockholders to promote
stability among key executives and employees.
NOW, THEREFORE, it is agreed as follows:
1. Duties of Employee. Employee shall support the
position of the Board of Directors and the chief executive
officer, and shall take any action requested by the Board of
Directors or the chief executive officer with respect to any
"Change of Control" (as defined at Section 7 below) of ConAgra.
If the Employee violates the provisions of this Section, he shall
forfeit any payments due to him under the terms of this
Agreement.
2. Employment Contract. If a Change of Control of ConAgra
occurs, and if at the initiation of the Change of Control attempt
Employee is then employed by ConAgra, ConAgra hereby agrees to
continue the employment of Employee for a period of three years
from the date the Change of Control effectively occurs. During
said three year period, Employee shall receive annual base and
incentive compensation in an amount not less than that specified
in Section 3(a) below.
If Employee is Involuntarily Terminated (as defined at
Section 7 below), at any time during the three year period,
ConAgra shall pay to Employee an amount equal to that which
Employee would have received pursuant to Section 3(a) below for
the remainder of the three year period, and shall also make the
payments specified in Sections 3(b) and 3(c) and, if applicable,
any additional payments specified in Section 5 below. In
addition, in the event of Involuntary Termination at any time,
Employee shall receive payment of the base and incentive
compensation described in Section 3(a) for one year. Any such
termination payment of base and incentive compensation shall be
made to Employee in a lump sum within thirty (30) days after
termination.
If Employee voluntarily terminates his employment at any
time during the three year period, the Acquiror (as defined
below), ConAgra, and their subsidiaries will not be obligated to
pay the Employee any amount that might be due for the remainder
of the three year period, or for any termination pay; however,
they shall make any additional payments specified in Sections
3(b), 3(c) and 5 (if applicable) below.
3. Description of Payments. The payments to be made to
Employee are:
(a) Annual Base and Incentive Compensation. Employee
shall receive for the three year period described in
Section 2 above an annual amount equal to his current
annual rate of compensation, which current annual
compensation shall be computed as follows: twenty-six
times the Employee's highest bi-weekly salary payment
received during the one year period ending immediately
prior to the Change of Control of ConAgra. In
addition, Employee shall receive for the three year
period described in Section 2 above (i) an amount of
annual short-term incentive equal to 80% of the annual
rate of compensation described above, and (ii) an
amount equal to the highest annual long-term
compensation award made to Employee during the three
fiscal years immediately preceding such Change of
Control (provided, for fiscal year 1997, such amount
shall be equal to the per unit payout for fiscal 1996
under the ConAgra's Long-Term Senior Management
Incentive Plan multiplied by the number of units
allocated to Employee for fiscal 1997).
(b) Retirement Benefits. Employee shall receive an
amount equal to that which he would have received as
retirement benefits under the provisions of the ConAgra
Pension Plan for Salaried Employees ("Qualified Pension
Plan") and the ConAgra Retirement Income Savings Plan
("CRISP") in effect immediately prior to the Change of
Control of ConAgra, had Employee continued his
employment until age 65 at the current annual rate of
base and short term incentive compensation as
determined above.
(i) The supplemental pension benefit hereunder
shall be equal to the result of subtracting
(x) the benefit the Employee will receive
under the Qualified Pension Plan from (y) the
pension benefit the Employee would obtain
under the Qualified Pension Plan if the
Employee remained in the employ of ConAgra
until the Employee attained age 65. The
supplemental pension benefit is to be
computed assuming the Employee is to receive
an unreduced normal retirement pension
benefit payable beginning at the later of the
date the Employee attains age 60 or the date
of the Employee's termination of employment.
If the Employee begins to receive his
supplemental pension benefit at a time other
than as described in the preceding sentence,
an actuarial adjustment shall be made to
reflect such event.
(ii) The supplemental CRISP benefit shall be equal
to the amount computed, as follows:
A. The additional years of service that the
Employee would receive if his or her
employment was not terminated prior to
attaining age 65 is multiplied by the
Employee's current annual base and short
term incentive compensation (as
described in Section 3(a)).
B. The result in A, immediately above, is
multiplied by 3%.
C. The result in B, immediately above, is
present valued to the date of the
Employee's termination of employment.
The discount factor for such present
value shall be the discount factor used
by the Qualified Pension Plan at the
time of such termination of employment.
The present value shall be computed
based on the assumption that the result
in B, immediately above, is paid ratably
(and monthly) over the additional years
of service of the Employee.
D. The present value amount determined
pursuant to C, immediately above, shall
be funded pursuant to Subsection (iv) of
this Section 3(b).
(iii) The actuarial assumptions and methods used by
this Section 3(b) shall be the same as those
used by the Qualified Pension Plan. The
timing of payment and the form of the
supplemental pension benefit under this
Section 3(b) shall be the same as elected by
the Employee under the Qualified Pension Plan
and the timing of payment and the form of the
supplemental CRISP benefit shall be the same
as elected by the Employee under CRISP;
(iv) The supplemental pension and CRISP benefits
payable under this Section 3(b) shall be
unfunded until a voluntary termination or
Involuntary Termination following a Change of
Control. Within 60 days following such a
termination, the supplemental pension and
CRISP benefits shall be funded, in one lump
sum payment, through a trust in the form
attached to the ConAgra Supplemental Pension
and CRISP Plan for Change of Control and
which trust is incorporated by reference.
The transferred amount for the supplemental
CRISP benefit shall be held in a separate
account and separately invested by the
trustee. The amount accumulated in such
account shall be the sole source of payment
of the supplemental CRISP benefit, and shall
be the amount of the supplemental CRISP
benefit hereunder. The Acquiror, ConAgra and
their subsidiaries shall make up any
supplemental pension benefit payments the
Employee does not receive under the trust,
e.g., if the funds in the trust are
insufficient to make the payments due to
insufficient earnings in the trust. The
trustee of such trust shall be a national or
state chartered bank. If funding of the
trust is not made within the sixty day period
described in this Subsection (iv) of this
Section 3(b), the Employee's supplemental
pension and CRISP benefits 3(b), the
Employee's supplemental pension and CRISP
benefits shall then be equal to the product
of 150% multiplied by the amount of
supplemental pension and CRISP benefits
described in this Section 3(b) above;
provided, however, this increase in benefits
is not intended to remove or detract from the
obligation to fund the trust. The
supplemental pension and CRISP benefits shall
not be paid from the assets of the Qualified
Pension Plan or CRISP.
(c) Additional Payment. If a Change of Control of
ConAgra occurs, Employee shall receive an amount equal
to the excess, if any, of the highest per share price
offered (valued in U.S. currency) by the successful
Acquiror for ConAgra common stock (which stock will
then be treated for purposes of this Agreement as
converted into equivalent shares of such Acquiror's or
the surviving company's capital stock as of the date of
the Change of Control of ConAgra) over the closing per
share price of such Acquiror's or the surviving
company's ("Acquiror") stock quoted on an established
securities market (or if applicable, the closing bid
price for the Acquiror's stock that is quoted on a
secondary market or substantial equivalent thereof) on
the date of termination (or if the date of termination
is not a business day, on the next preceding business
day), multiplied by the highest number of shares of the
Acquiror's capital stock owned by the Employee at any
time during the period beginning on the date of the
Change of Control of ConAgra and ending on the date of
termination. For purposes of this Section 3(c), the
additional amount due hereunder shall be computed as if
Employee owned all of the Acquiror's stock with respect
to which Employee has an option to purchase in
connection with his employment with the Acquiror,
ConAgra or any of their subsidiaries. Said amount
shall be paid to Employee within ten days after
termination. In addition, if Employee sells any of the
Acquiror's stock within one year following said
termination, Employee shall receive the amount by which
the closing price of such stock per share on the date
of termination (determined as aforesaid) exceeds the
per share actual net sales price of the Acquiror's
stock on the date of sale realized by Employee,
multiplied by the number of shares sold by Employee.
Said amount shall be paid in immediately available
funds to Employee within ten days after the sale. In
addition, to the extent any of ConAgra's common stock
remains outstanding after a Change of Control, then
Employee shall receive additional amounts computed and
payable in a manner similar to that provided in this
Section 3(c) for Acquiror's stock owned, or subject to
an option held, by Employee. These provisions shall be
appropriately modified or adjusted to take into account
the fact that the computations pursuant to the
preceding sentence are with respect to ConAgra common
stock and related options rather than the Acquiror's
capital stock and options related thereto. The
computations and payments under this Section 3(c) shall
include appropriate adjustments for any stock splits,
stock dividends, recapitalizations or similar share
restructurings that may occur from time to time.
4. Merger. ConAgra shall not merge, reorganize,
consolidate or sell all or substantially all of its assets, to or
with any other corporation until such corporation and its
subsidiaries, if any, expressly assume the duties of ConAgra set
forth herein.
5. Certain Additional Payments by ConAgra.
(a) Anything in this Agreement to the contrary
notwithstanding, in the event it shall be determined
that any payment or distribution by ConAgra to or for
the benefit of the Employee, whether paid or payable or
distributed or distributable pursuant to the terms of
this Agreement or otherwise (a "Payment"), would be
subject to the excise tax imposed by Section 4999 of
the Internal Revenue Code of 1986, as amended (the
"Code") or any interest or penalties with respect to
such excise tax (such excise tax, together with any
such interest and penalties, are hereinafter
collectively referred to as the "Excise Tax"), then the
Employee shall be entitled to receive an additional
payment (a "Gross-Up Payment") in any amount such that
after payment by the Employee of all taxes (including
any interest or penalties imposed with respect to such
taxes), including any Excise Tax, imposed upon the
Gross-Up Payment, the Employee retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon
the Payments.
(b) Subject to the provisions of Subsection (c) below,
all determinations required to be made under this
Section, including whether a Gross-Up Payment is
required and the amount of such Gross-Up Payment, shall
be made by the certified public accounting firm then
representing ConAgra (the "Accounting Firm") which
shall provide detailed supporting calculations both to
ConAgra and the Employee within 15 business days of the
date of termination, if applicable, or such earlier
time as is requested by ConAgra or Employee. If the
Accounting Firm determines that no Excise Tax is
payable by the Employee, it shall furnish the Employee
with an opinion that he has substantial authority not
to report any Excise Tax on his federal income tax
return. Any determination by the Accounting Firm shall
be binding upon ConAgra and the Employee. As a result
of the uncertainty in the application of Section 4999
of the Code at the time of the initial determination by
the Accounting Firm hereunder, it is possible that
Gross-Up Payments which will not have been made by
ConAgra should have been made ("Underpayment"),
consistent with the calculations required to be made
hereunder. In the event that ConAgra exhausts its
remedies pursuant to Subsection (c) below and the
Employee thereafter is required to make a payment of
any Excise Tax, the Accounting Firm shall determine the
amount of the Underpayment that has occurred and any
such Underpayment shall be promptly paid by ConAgra to
or for the benefit of the Employee.
(c) The Employee shall notify ConAgra in writing of
any claim by the Internal Revenue Service that, if
successful, would require the payment by ConAgra of the
Gross-Up Payment. Such notification shall be given as
soon as practicable but no later than ten (10) business
days after the Employee knows of such claim and shall
apprise ConAgra of the nature of such claim and the
date on which such claim is requested to be paid. The
Employee shall not pay such claim prior to the
expiration of the thirty-day (30 day) period following
the date on which it gives such notice to ConAgra (or
such shorter period ending on the date that any payment
of taxes with respect to such claim is due). If
ConAgra notifies the Employee in writing prior to the
expiration of such period that it desires to contest
such claim, the Employee shall:
(i) give ConAgra any information reasonably
requested by ConAgra relating to such claim,
(ii) take such action in connection with
contesting such claim as ConAgra shall
reasonably request in writing from time to
time, including, without limitation,
accepting legal representation with respect
to such claim by an attorney reasonably
selected by ConAgra,
(iii) cooperate with ConAgra in good faith in order
to effectively contest such claim,
(iv) permit ConAgra to participate in any
proceedings relating to such claim;
provided, however, that ConAgra shall bear and pay
directly all costs and expenses (including additional
interest and penalties) incurred in connection with
such contest and shall indemnify and hold the Employee
harmless, on an after-tax basis, for any Excise Tax or
income tax, including interest and penalties with
respect thereto, imposed as a result of such
representation and payment of costs and expenses.
Without limitation on the foregoing provisions of this
Subsection (c), ConAgra shall control all proceedings
taken in connection with such contest and, at its sole
option, may pursue or forego any and all administrative
appeals, proceedings, hearings and conferences with the
taxing authority in respect of such claim and may, at
its sole option, either direct the Employee to pay the
tax claimed and xxx for a refund or contest the claim
in any permissible manner, and the Employee agrees to
prosecute such contest to a determination before any
administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as
ConAgra shall determine; provided, however, that if
ConAgra directs the Employee to pay such claim and xxx
for a refund, ConAgra shall advance the amount of such
payment to the Employee, on an interest-free basis and
shall indemnify and hold the Employee harmless, on an
after-tax basis, from any Excise Tax or income tax,
including interest or penalties with respect thereto,
imposed with respect to such advance or with respect to
any imputed income with respect to such advance; and
further provided that any extension of the statute of
limitations relating to payment of taxes for the
taxable year of the Employee with respect to which such
contested amount is claimed to be due is limited solely
to such contested amount. Furthermore, ConAgra's
control of the contest shall be limited to issues with
respect to which a Gross-Up Payment would be payable
hereunder and the Employee shall be entitled to settle
or contest, as the case may be, any other issue raised
by the Internal Revenue Service or any other taxing
authority.
(d) If, after the receipt by the Employee of an amount
advanced by ConAgra pursuant to Subsection (c) above,
the Employee becomes entitled to receive any refund
with respect to such claim, the Employee shall (subject
to ConAgra's complying with the requirements of
Subsection (c)) promptly pay to ConAgra the amount of
such refund (together with any interest paid or
credited thereon after taxes applicable thereto). If,
after the receipt by the Employee of an amount advanced
by ConAgra pursuant to Subsection (c), a determination
is made that the Employee shall not be entitled to any
refund with respect to such claim and ConAgra does not
notify the Employee in writing of its intent to contest
such denial of refund prior to the expiration of thirty
days after such determination, then such advance shall
be forgiven and shall not be required to be repaid and
the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be
paid.
6. Term and Binding Effect. This Agreement shall bind
ConAgra and Employee as long as Employee remains in the employ of
ConAgra; provided, however, ConAgra may terminate this Agreement
at any time by giving notice to Employee; and provided further,
however, that ConAgra may not terminate this Agreement at any
time subsequent to the announcement of an event that could result
in a Change of Control of ConAgra. This Agreement shall be
binding upon the parties hereto, their heirs, executors,
administrators and successors.
7. Certain Definitions. The following definitions shall
apply for the purposes of this Agreement:
(a) Change of Control of ConAgra. The term "Change of
Control" shall mean:
(i) The acquisition (other than from ConAgra) 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, ConAgra or its subsidiaries, or any
employee benefit plan of ConAgra or its
subsidiaries, which acquires beneficial
ownership of voting securities of ConAgra) 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 ConAgra'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 election by
ConAgra'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) Approval of the shareholders of ConAgra of a
reorganization, merger, consolidation, in
each case, with respect to which persons who
were the shareholders of ConAgra 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 ConAgra or of
the sale of all or substantially all of its
assets.
(b) Involuntary Termination. The term "Involuntary
Termination" or any variation thereof shall mean either
(i) the actual involuntary termination of Employee's
employment with the Acquiror, ConAgra and their
subsidiaries after a Change of Control (with or without
cause) or (ii) the constructive involuntary termination
of the Employee's employment with the Acquiror, ConAgra
and their subsidiaries after a Change of Control. The
term "constructive involuntary termination" shall
include (w) a reduction in the Employee's compensation
(including applicable fringe benefits); (x) a
substantial change in the location of the Employee's
job without the Employee's written consent; (y) the
Employee's demotion or diminution in the Employee's
position, authority, duties or responsibilities without
the Employee's written consent; or (z) the sale or
disposition of the stock of Employee's immediate
employer, which was a subsidiary of the Acquiror,
ConAgra, or their other subsidiaries immediately prior
to such sale or disposition, provided Employee is not
employed after such sale or disposition by the
Acquiror, ConAgra, or any of their subsidiaries that
are retained after such sale or disposition.
"Substantial change in location" means any location
change in excess of 35 miles from the location of the
Employee's job with ConAgra or its subsidiaries at the
time of the Change of Control of ConAgra.
8. Costs. All costs of litigation necessary for the
Employee to defend the validity of this contract are to be paid
by ConAgra or its successors or assigns.
IN WITNESS WHEREOF, the parties have executed this
Agreement.
EMPLOYEE: CONAGRA, INC.
/s/ Xxxxx Xxxxx /s/ Xxxxxx X. Xxxxxxxx
_______________________ __________________________
XXXXX XXXXX Chairman, Board of Directors
