EXHIBIT 10.1
PERFORMANCE FOOD GROUP COMPANY
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION AGREEMENT (this "Agreement") is made and
entered into on _________ (the "Grant Date"), by and between Performance Food
Group Company, a Tennessee corporation (together with its Subsidiaries and
Affiliates, the "Company"), and ________________ (the "Optionee"). Capitalized
terms not otherwise defined herein shall have the meaning ascribed to such terms
in the Performance Food Group Company 2003 Equity Incentive Plan (the "Plan").
WHEREAS, the Company has adopted the Plan, which permits the issuance of
stock options for the purchase of shares of the common stock, par value $.01 per
share, of the Company (the "Shares"); and
WHEREAS, the Company desires to afford the Optionee an opportunity to
purchase Shares as hereinafter provided in accordance with the provisions of the
Plan;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto, intending to be legally
bound hereby, agree as follows:
1. Grant of Option.
(a) The Company grants as of the date of this Agreement the right
and option (the "Option") to purchase _________ Shares, in whole or in part (the
"Option Stock"), at an exercise price of $_____ per Share, on the terms and
conditions set forth in this Agreement and subject to all provisions of the
Plan. The Optionee, holder or beneficiary of the Option shall not have any of
the rights of a shareholder with respect to the Option Stock until such person
has become a holder of such Shares by the due exercise of the Option and payment
of the Option Payment (as defined in Section 3 below) in accordance with this
Agreement.
(b) The Option shall be a non-qualified stock option. In order to
provide the Company with the opportunity to claim the benefit of any income tax
deduction which may be available to it upon the exercise of the Option, and in
order to comply with all applicable federal or state tax laws or regulations,
the Company may take such action as it deems appropriate to insure that, if
necessary, all applicable federal, state or other taxes are withheld or
collected from the Optionee.
2. Exercise of Option. The Optionee may exercise the Option beginning on
the fourth anniversary of the date of this Agreement provided that Optionee has
been an employee of the Company at all times from the Grant Date to such fourth
anniversary (such four-year period being referred to as the "Vesting Period").
Notwithstanding the above, each outstanding Option shall vest and become
exercisable upon the occurrence of a Change in Control or Potential Change in
Control and shall be governed by the provisions of Section 13 of the Plan. In
the event that the Optionee dies, is Disabled or elects Normal Retirement (as
defined below) before the expiration of the Vesting Period, the Option shall
vest as of the date of such death, disability
or Normal Retirement, as the case may be, on a pro rata basis with respect to
the amount of the Vesting Period that has elapsed, rounded to the nearest whole
share. If Optionee elects Early Retirement (as defined below) prior to the
expiration of the Vesting Period, this Option shall vest as though Optionee had
elected Normal Retirement, provided that the Optionee's Early Retirement is with
the consent of the Committee. "Early Retirement" means retirement, for purposes
of the Plan with the express consent of the Company at or before the time of
such retirement, from active employment with the Company prior to age 65, in
accordance with any applicable early retirement policy of the Company then in
effect. "Normal Retirement" means retirement from active employment with the
Company on or after age 65. For purposes of this Agreement, "Disabled" means
that the Optionee is permanently unable to perform the essential duties of the
Optionee's occupation.
3. Manner of Exercise. The Option may be exercised in whole or in part at
any time within the period permitted hereunder for the exercise of the Option,
with respect to whole Shares only, by serving written notice of intent to
exercise the Option delivered to the Company at its principal office (or to the
Company's designated agent), stating the number of Shares to be purchased, the
person or persons in whose name the Shares are to be registered and each such
person's address and social security number. Such notice shall not be effective
unless accompanied by payment in full of the Option Price for the number of
Shares with respect to which the Option is then being exercised (the "Option
Payment") and cash equal to the required withholding taxes as set forth by
Internal Revenue Service and applicable State tax guidelines for the employer's
minimum statutory withholding. The Option Payment shall be made in cash or cash
equivalents or in whole Shares that have been held by the Optionee for at least
six months prior to the date of exercise valued at the Shares' Fair Market Value
on the date of exercise (or next succeeding trading date if the date of exercise
is not a trading date) or the actual sales price of such Shares, together with
any applicable withholding taxes, or by a combination of such cash (or cash
equivalents) and Shares. The Optionee shall not be entitled to tender Shares
pursuant to successive, substantially simultaneous exercises of the Option or
any other stock option of the Company. Subject to applicable securities laws,
the Optionee may also exercise the Option by delivering a notice of exercise of
the Option and by simultaneously selling the Shares of Option Stock thereby
acquired pursuant to a brokerage or similar agreement approved in advance by
proper officers of the Company, using the proceeds of such sale as payment of
the Option Payment, together with any applicable withholding taxes. For purposes
of this Agreement, "Fair Market Value" means the closing sales price of the
Shares on the Nasdaq Stock Market's National Market System or the actual sales
price of such Shares.
4. Termination of Option. The Option will expire ten years from the date
of grant of the Option (the "Term") with respect to any then unexercised portion
thereof, unless terminated earlier as set forth below:
(a) Termination by Death. If the Optionee's employment by the
Company terminates by reason of death, or if the Optionee dies within three
months after termination of such employment for any reason other than Cause,
this Option may thereafter be exercised by the legal representative of the
estate or by the legatee of the Optionee under the will of the Optionee, for a
period of one year from the date of death or until the expiration of the Term of
the Option, whichever period is the shorter.
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(b) Termination by Reason of Disability. If the Optionee's
employment by the Company terminates by reason of Disability, this Option may
thereafter be exercised by the Optionee or personal representative or guardian
of the Optionee, as applicable, for a period of three years from the date of
such termination of employment or until the expiration of the Term of the
Option, whichever period is the shorter.
(c) Termination by Retirement. If Optionee's employment by the
Company terminates by reason of Early Retirement or Normal Retirement, this
Option may thereafter be exercised by the Optionee until the expiration of the
Term of the Option.
(d) Termination for Cause or Voluntary Termination. If the
Optionee's employment by the Company is voluntarily terminated or terminated for
Cause, this Option shall terminate immediately and become void and of no effect.
(e) Other Termination. If the Optionee's employment by the Company
is involuntarily terminated for any reason other than for Cause, death,
Disability or Normal Retirement or Early Retirement, this Option may be
exercised, to the extent the Option was exercisable at the time of such
termination, by the Optionee for a period of three months from the date of such
termination of employment or the expiration of the Term of the Option, whichever
period is the shorter.
5. No Right to Continued Employment. The grant of the Option shall not be
construed as giving Optionee the right to be retained in the employ of the
Company, and the Company may at any time dismiss Optionee from employment, free
from any liability or any claim under the Plan.
6. Adjustment to Option Stock. The Committee may make adjustments in the
terms and conditions of, and the criteria included in, this Option in
recognition of unusual or nonrecurring events (including, without limitation,
the events described in Section 4.2 of the Plan) affecting the Company or the
financial statements of the Company or of changes in applicable laws,
regulations, or accounting principles, whenever the Committee determines that
such adjustments are appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the Plan.
7. Amendments to Option. Subject to the restrictions contained in Sections
6.2 and 14 of the Plan, the Committee may waive any conditions or rights under,
amend any terms of, or alter, suspend, discontinue, cancel or terminate, the
Option, prospectively or retroactively; provided that any such waiver,
amendment, alteration, suspension, discontinuance, cancellation or termination
that would adversely affect the rights of the Optionee or any holder or
beneficiary of the Option shall not to that extent be effective without the
consent of the Optionee, holder or beneficiary affected.
8. Limited Transferability. During the Optionee's lifetime this Option can
be exercised only by the Optionee, except as otherwise provided in Section 4(a)
above or in this Section 8. This Option may not be assigned, alienated, pledged,
attached, sold or otherwise transferred or encumbered by Optionee other than (i)
to a Permitted Transferee or (ii) by will or the laws of descent and
distribution. Any attempt to otherwise transfer this Option shall be void.
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No transfer of this Option by the Optionee by will or by laws of descent and
distribution shall be effective to bind the Company unless the Company shall
have been furnished with written notice thereof and an authenticated copy of the
will and/or such other evidence as the Committee may deem necessary or
appropriate to establish the validity of the transfer. Any transfer of this
Option by the Optionee to a Permitted Transferee must be for no consideration
and, after the transfer, the Permitted Transferee shall have the sole
responsibility for determining whether and when to exercise the Option. A
Permitted Transferee may not transfer any such Option other than by will or the
laws of descent and distribution. For purposes of this Agreement, "Permitted
Transferee" means the Optionee's Immediate Family, a Permitted Trust or a
partnership of which the only partners are members of the Optionee's Immediate
Family. For purposes of this Agreement, "Immediate Family" means the Optionee's
children and grandchildren, including adopted children and grandchildren,
stepchildren, parents, stepparents, grandparents, spouse, siblings (including
half brothers and sisters), father-in-law, mother-in-law, daughters-in-law and
sons-in-law. For purposes of this Agreement, a "Permitted Trust" means a trust
solely for the benefit of the Optionee or Optionee's Immediate Family.
9. Reservation of Shares. At all times during the term of this Option, the
Company shall use its best efforts to reserve and keep available such number of
Shares as shall be sufficient to satisfy the requirements of this Agreement.
10. Plan Governs. The Optionee hereby acknowledges receipt of a copy of
the Plan and agrees to be bound by all the terms and provisions thereof. The
terms of this Agreement are governed by the terms of the Plan, and in the case
of any inconsistency between the terms of this Agreement and the terms of the
Plan, the terms of the Plan shall govern.
11. Severability. If any provision of this Agreement is, or becomes, or is
deemed to be invalid, illegal, or unenforceable in any jurisdiction or as to any
Person or the Award, or would disqualify the Plan or Award under any laws deemed
applicable by the Committee, such provision shall be construed or deemed amended
to conform to the applicable laws, or if it cannot be construed or deemed
amended without, in the determination of the Committee, materially altering the
intent of the Plan or the Award, such provision shall be stricken as to such
jurisdiction, Person or Award, and the remainder of the Plan and Award shall
remain in full force and effect.
12. Notices. All notices required to be given under this Option shall be
deemed to be received if delivered or mailed as provided for herein to the
parties at the following addresses, or to such other address as either party may
provide in writing from time to time.
To the Company: Performance Food Group Company
00000 Xxxx Xxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Chief Financial Officer
To the Optionee:
____________________________
____________________________
____________________________
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13. Governing Law. The validity, construction and effect of this
Agreement shall be determined in accordance with the laws of the State of
Tennessee without giving effect to conflicts of laws principles.
14. Resolution of Disputes. Any dispute or disagreement which may
arise under, or as a result of, or in any way related to, the interpretation,
construction or application of this Agreement shall be determined by the
Committee. Any determination made hereunder shall be final, binding and
conclusive on the Optionee and the Company for all purposes.
15. Successors in Interest. This Agreement shall inure to the
benefit of and be binding upon any successor to the Company. This Agreement
shall inure to the benefit of the Optionee's legal representative and assignees.
All obligations imposed upon the Optionee and all rights granted to the Company
under this Agreement shall be binding upon the Optionee's heirs, executors,
administrators, successors and assignees.
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IN WITNESS WHEREOF, the parties have caused this Non-Qualified Stock
Option Agreement to be duly executed effective as of the day and year first
above written.
PERFORMANCE FOOD GROUP COMPANY
By: __________________________________
Optionee:
______________________________________
Please Print
Optionee:
______________________________________
Signature
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