[Name]
[Street Address]
[City, State & Zip Code]
You are
presently the [Title] of Nash Finch Company, a Delaware
corporation. The Company considers the establishment and
maintenance of a sound and vital management to be essential to
protecting and enhancing the best interests of the Company and its
stockholders. In this connection, the Company recognizes that, as
is the case with many publicly held corporations, the possibility
of a Change in Control may arise and that such possibility, and the
uncertainty and questions which it may raise among management, may
result in the departure or distraction of management personnel to
the detriment of the Company and its stockholders.
Accordingly,
the Board has determined that appropriate steps should be taken to
minimize the risk that Company management will depart prior to a
Change in Control, thereby leaving the Company without adequate
management personnel during such a critical period, and that
appropriate steps also be taken to reinforce and encourage the
continued attention and dedication of members of the
Company’s management to their assigned duties without
distraction in circumstances arising from the possibility of a
Change in Control. In particular, the Board believes it important,
should Nash Finch Company or its stockholders receive a proposal of
transfer of control, that you be able to continue your management
responsibilities and assess and advise the Board whether such
proposal would be in the best interests of Nash Finch Company and
its stockholders and to take other action regarding such proposal
as the Board might determine to be appropriate, without being
influenced by the uncertainties of your own personal
situation.
The Board
recognizes that continuance of your position with the Company
involves a substantial commitment to the Company in terms of your
personal life and professional career and the possibility of
foregoing present and future career opportunities, for which the
Company receives substantial benefits. Therefore, to induce you to
remain in the employ of the Company, this letter agreement, which
has been approved by the Board, sets forth the benefits which the
Company agrees will be provided to you in the event your employment
with the Company is terminated in connection with a Change in
Control under the circumstances described below.
1.
Definitions . The following terms will have the meaning set
forth below unless the context clearly requires otherwise. Terms
defined elsewhere in this Agreement will have the same meaning
throughout this Agreement.
(a) “
Agreement ” means this letter agreement as amended,
extended or renewed from time to time in accordance with its
terms.
(b) “
Board ” means the board of directors of the Parent
Corporation duly qualified and acting at the time in
question.
(c) “
Cause ” means: (i) the willful and continued
failure by you to substantially perform your duties to the Company
(other than any such failure resulting from your Disability or
incapacity due to bodily injury or physical or mental illness)
after a demand for substantial performance is delivered to you by
the Company which specifically identifies the manner in which you
have not substantially performed your duties; or (ii) your
conviction (including a plea of nolo contendere) of a felony or
gross misdemeanor under federal or state law that the Board
determines is injurious to reputation or the business of the
Company; (iii) your commission of any act involving
dishonesty, fraud, gross negligence or other willful
misconduct in
the performance of your duties of the Company or (iv) your
breach of any confidentiality, non-compete or non-solicitation
covenants you may have with the Company. For purposes of this
definition, no act, or failure to act, on your part will be
considered “willful” unless done, or omitted to be
done, by you in bad faith and without reasonable belief that your
action or omission was in, or not opposed to, the best interests of
the Company. Any act, or failure to act, based upon authority given
pursuant to a resolution duly adopted by the Board (or a committee
hereof) or based upon the advice of counsel for the Company will be
conclusively presumed to be done, or omitted to be done, by you in
good faith and in the best interests of the Company. It is also
expressly understood that your attention to matters not directly
related to the business of the Company will not provide a basis for
termination for Cause so long as the Board does not expressly
disapprove in writing of your engagement on such activities either
before or within a reasonable period of time after the Board knew
or could reasonably have known that you engaged in those
activities. Notwithstanding the foregoing, you will not be deemed
to have been terminated for Cause unless and until there has been
delivered to you a copy of a resolution duly adopted by the Board
(after reasonable notice to you and an opportunity for you,
together with your counsel, to be heard before the Board), finding
that in the good faith opinion of the Board you were guilty of the
conduct set forth above and specifying the particulars thereof in
detail.
(d) “
Change in Control ” means:
(i) Any one person
or more than one person acting as a group acquires ownership of
stock of the Company that, together with the stock held by such
person or group, constitutes more than 50 percent (50%) of the
total fair market value or total voting power of the stock of the
Company. However, if any one person or more than one person acting
as a group, is considered to own more than 50 percent (50%) of
the total fair market value or total voting power of the stock of
the Company, the acquisition of additional stock by the same person
or persons is not considered to cause a Change in
Control;
(ii) Any one
person, or more than one person acting as a group acquires (or has
acquired during the twelve (12) month period ending on the
date of the most recent acquisition by such person or persons)
ownership of stock of the Company possessing thirty percent (30%)
or more of the total voting power of the stock of the
Company;
(iii) Any one
person, or more than one person acting as a group acquires (or has
acquired during the twelve (12) month period ending on the
date of the most recent acquisition by such person or persons) all
or substantially all of the assets of the Company immediately prior
to such acquisition or acquisitions; or
(iv) A majority of
the members of the Board is replaced during any twelve
(12) month period by directors whose appointment or election
is not endorsed by a majority of the members of the Board prior to
the date of the appointment or election;
provided, that
the transaction or event described in subsection (i), (ii),
(iii) or (iv) also constitutes a “change in control
event,” as defined in Treasury Regulation
§1.409A-3(i)(5).
(e) “
Code ” means the Internal Revenue Code of 1986, as
amended.
(f) “
Company ” means the Parent Corporation, any Subsidiary
and any Successor.
(g) “
Confidential Information ” means information which is
proprietary to the Company or proprietary to others and entrusted
to the Company, whether or not trade secrets. It includes
information relating to business plans and to business as conducted
or anticipated to be conducted, and to past or current or
anticipated products or services. It also includes, without
limitation, information concerning research, development,
purchasing, accounting, marketing and selling. All information
which you have a reasonable basis to consider confidential is
Confidential Information, whether or not originated by you and
without regard to the manner in which you obtain access to that and
any other proprietary information.
(h) “
Date of Termination ” following a Change in Control
(or prior to a Change in Control if your termination was either a
condition of the Change in Control or was at the request or
insistence of any Person (other than the Company) related to the
Change in Control) means: (i) if your employment is to be
terminated for Disability, thirty (30) calendar days after
Notice of Termination is given (provided that you have not returned
to the performance of your duties on a full-time basis during such
thirty (30)-calendar-day period); (ii) if your employment is
to be terminated by the Company for Cause or by you for Good
Reason, the date specified in the Notice of Termination;
(iii) if your employment is to be terminated by the Company
for any reason other than Cause, Disability, death or Retirement,
the date specified in the Notice of Termination, which in no event
may be a date earlier than ninety (90) calendar days after the
date on which a Notice of Termination is given, unless an earlier
date has been expressly agreed to by you in writing either in
advance of, or after, receiving such Notice of Termination; or
(iv) if your employment is terminated by reason of death or
Retirement, the date of death or Retirement, respectively; provided
that in all events the applicable “Date of Termination”
shall be the date of your “separation from service”
within the meaning of Treasury
Regulation Section 1.409A-1(h). In the case of
termination by the Company of your employment for Cause, if you
have not previously expressly agreed in writing to the termination,
then within thirty (30) calendar days after receipt by you of
the Notice of Termination with respect thereto, you may notify the
Company that a dispute exists concerning the termination, in which
event the Date of Termination will be the date set either by mutual
written agreement of the parties or by the judge or arbitrators in
a proceeding as provided in Section 13 of this Agreement.
During the pendency of any such dispute, the Company will continue
to pay you your full compensation and benefits in effect just prior
to the time the Notice of Termination is given and until the
dispute is resolved in accordance with Section 13 of this
Agreement.
(i) “
Disability ” means a disability as defined in the
Company’s long-term disability plan as in effect immediately
prior to the Change in Control or, in the absence of such a plan,
means permanent and total disability as defined in section 22(e)(3)
of the Code.
(j) “
Exchange Act ” means the Securities Exchange Act of
1934, as amended.
(k) “
Good Reason ” means:
(i) a material
adverse change in your status or position(s) as an executive of the
Company as in effect immediately prior to the Change in Control,
including, without limitation, any adverse change in your status or
position(s) as a result of a material diminution in your duties or
responsibilities (other than, if applicable, any such change
directly attributable to the fact that the Company is no longer
publicly owned) or the assignment to you of any duties or
responsibilities which are inconsistent with such status or
position(s), or any removal of you from or any failure to reappoint
or reelect you to such position(s) (except in connection with the
termination of your employment for Cause, Disability or Retirement
or as a result of your death or by you other than for Good
Reason);
(ii) a reduction
by the Company in your rate of total compensation (including,
without limitation, salary and bonus potential) (or an adverse
change in the form or timing of the payment thereof) as in effect
immediately prior to the Change in Control;
(iii) the failure
by the Company to continue in effect any Plan in which you (and/or
your family) are participating at any time during the ninety
(90)-calendar-day period immediately preceding the Change in
Control (or Plans providing you (and/or your family) with at least
substantially similar benefits) other than as a result of the
normal expiration of any such Plan in accordance with its terms as
in effect immediately prior to the ninety (90)-calendar-day period
immediately preceding the time of the Change in Control, or the
taking of any action, or the failure to act, by the Company which
would adversely affect you (and/or your family’s) continued
participation in any of such Plans on at least as favorable a basis
to you (and/or your family) as is the case on the date of the
Change in Control or which would materially reduce your (and/or
your family’s) benefits in the future under any of such Plans
or deprive you (and/or your family) of any material benefit enjoyed
by you (and/or your family) at the time of the Change in
Control;
(iv) the
Company’s requiring you to be based more than fifty
(50) miles from where your office is located immediately prior
to the Change in Control, except for required travel on the
Company’s business, and then only to the extent substantially
consistent with the business travel obligations which you undertook
on behalf of the Company during the ninety (90)-calendar-day period
immediately preceding the Change in Control (without regard to
travel related or in anticipation of the Change in
Control);
(v) the failure by
the Company to obtain from any Successor the assent to this
Agreement contemplated by Section 6 of this
Agreement.
(vi) any purported
termination by the Company of your employment which is not properly
effected pursuant to a Notice of Termination and pursuant to any
other requirements of this Agreement, and for purposes of this
Agreement, no such purported termination will be effective;
or
(vii) any refusal
by the Company to continue to allow you to attend to matters or
engage in activities not directly related to the business of the
Company which, at any time prior to the Change in Control, you were
not expressly prohibited in writing by the Board from attending to
or engaging in.
(l) “
Highest Monthly Compensation ” means one-twelfth
(1/12) of the highest amount of your compensation for any twelve
(12) consecutive calendar-month period during the thirty-six
(36) consecutive calendar-month period prior to the month that
includes the Date of Termination. For purposes of this definition,
“compensation” means your base pay plus short term
bonus target.
(m) “
Notice of Termination ” means a written notice which
indicates the specific termination provision in this Agreement
pursuant to which the notice is given. Any purported termination by
the Company or by you following a Change in Control (or prior to a
Change in Control if your termination was either a condition of the
Change in Control or was at the request or insistence of any Person
(other than the Company) related to the Change in Control) must be
communicated by written Notice of Termination.
(n) “
Parent Corporation ” means Nash Finch Company and any
Successor.
(o) “
Person ” means and includes any individual,
corporation, partnership, group, association or other
“person”, as such term is used in section 14(d) of the
Exchange Act, other than the Parent Corporation, a wholly-owned
subsidiary of the Parent Corporation or any employee benefit
plan(s) sponsored by the Parent Corporation or a wholly-owned
subsidiary of the Parent Corporation.
(p) “
Plan ” means any compensation plan (such as a stock
option, restricted stock plan or other equity-based plan), or any
employee benefit plan (such as a thrift, pension, profit sharing,
medical, dental, disability, accident, life insurance, relocation,
salary continuation, expense reimbursements, vacation, fringe
benefits, office and support staff plan or policy) or any other
plan, program, policy or agreement of the Company intended to
benefit you (and/or your family) (including, without limitation,
the Company’s 2000 Stock Incentive Plan, Profit Sharing Plan,
Income Deferral Plan, Deferred Compensation Plan and Supplemental
Executive Retirement Plan).
(q) “
Retirement ” means the day on which you attain the age
of sixty-five (65).
(r) “
Subsidiary ” means any corporation at least a majority
of whose securities having ordinary voting power for the election
of directors is at the time owned by the Company and/or one
(1) or more Subsidiaries.
(s) “
Successor ” means any Person that succeeds to, or has
the practical ability to control (either immediately or with the
passage of time), the Parent Corporation’s business directly,
by merger,
consolidation
or other form of business combination, or indirectly, by purchase
of the Parent Corporation’s voting securities, all or
substantially all of its assets or otherwise.
2. Term
of Agreement . This Agreement is effective immediately and will
continue in effect until December 31, 2008; provided, however,
that commencing on
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