Exhibit
10.2
Corporate Officer
MCA
2006
AMENDED AND RESTATED
MANAGEMENT CONTINUITY AGREEMENT
AGREEMENT
between Ralcorp Holdings, Inc. a Misouri corporation ("Ralcorp")
and ________________ (the "Executive"), WITNESSETH:
WHEREAS, the Board of
Directors (the "Board") has authorized Ralcorp to enter into
Management Continuity Agreements with certain key executives of
Ralcorp; and
WHEREAS, the Executive
is a key executive of Ralcorp and has been selected by the Board to
be offered this Management Continuity Agreement; and
WHEREAS, should a third
person take steps which might lead to a Change in Control of
Ralcorp (as defined herein), the Board believes it imperative that
Ralcorp be able to rely upon the Executive to continue in the
Executive’s position, and that Ralcorp be able to receive and
rely upon the Executive’s advice, if it is requested, as to
the best interests of Ralcorp and its shareholders without concern
that the Executive might be distracted by the personal
uncertainties and risks created by such a Change in Control or
influenced by conflicting interests; and
WHEREAS, the Board and
Executive have agreed to amend and restate the terms of this
Agreement and replace any previous Management Continuity Agreement
with this Agreement.
NOW, THEREFORE, for and
in consideration of the premises and other good and valuable
consideration, Ralcorp and the Executive agree as follows:
1. Definitions . For
purposes of this Agreement, the following terms shall have the
meanings set forth below:
a.
“Accounting Firm” as defined in Section 7.
b.
"Base Amount" shall be the Executive's Base Amount as defined and
determined pursuant to Section 280G of the Code and regulations
applicable at the time of the Executive's Qualifying
Termination.
c.
"Base Compensation" shall consist of:
(i) The
Executive's monthly gross salary for the last full month preceding
the Executive’s Qualifying Termination or for the last full
month preceding the Change in Control, whichever is higher.
If Executive has elected to accelerate or defer salary (including
the Executive's pre-tax contributions under the Ralcorp Holdings,
Inc. Savings Investment Plan and under any benefit plan complying
with Section 125 of the Code and deferrals pursuant to the
Executive Savings Investment Plan, and any successor plans
thereto), said monthly gross salary shall be calculated as if there
had been no acceleration or deferral.
(ii)
one-twelfth the higher of (x) the bonus to which the Executive
would be entitled in the fiscal year in which a Qualifying
Termination occurred after assuming all performance targets
(personal and Company targets) were achieved at a level of 100% or
(y) the Executive's last annual bonus paid by the Company, whether
paid or deferred, preceding the Executive’s Qualifying
Termination or the Change in Control, whichever is higher.
d.
"Change in Control" means (i) the acquisition 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"), of
beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of (x) 50% or more of the aggregate voting
power of the then outstanding shares of Stock, other than
acquisitions by Ralcorp or any of its subsidiaries or any employee
benefit plan of Ralcorp (or any Trust created to hold or invest in
issues thereof) or any entity holding Stock for or pursuant to the
terms of any such plan, or (y) all, or substantially all, of the
assets of Ralcorp or its subsidiaries taken as a whole; or (ii)
individuals who shall qualify as Continuing Directors shall have
ceased for any reason to constitute at least a majority of the
Board of Directors of Ralcorp. Notwithstanding the foregoing,
a Change-in-Control shall not include a transaction (commonly known
as a “Morris Trust” transaction) pursuant to which a
third party acquires one or more businesses of the Company by
acquiring all of the common stock of Ralcorp while leaving the
Company’s remaining businesses in a separate public company,
unless the businesses so acquired constitute all or substantially
all of the Company’s businesses.
e.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
f.
"Company" shall mean Ralcorp Holdings, Inc. and its wholly owned
subsidiaries.
g.
“Continuing Director" means any member of the Board of
Directors of Ralcorp, as of February 1, 1997 while such person
is a member of the Board, and any other director, while such other
director is a member of the Board, who is recommended or elected to
succeed the Continuing Director by at least two-thirds (2/3) of the
Continuing Directors then in office.
h.
"Disability" shall exist when the Executive suffers a complete and
permanent inability to perform any and every material duty of the
Executive’s regular occupation because of injury or
sickness.
To determine whether the Executive is Disabled, the Executive shall
undergo examination by a licensed physician and other experts
(including other physicians) as determined by such physician, and
the Executive shall cooperate in providing relevant medical records
as requested. The Company and Executive shall jointly select
such physician. If they are unable to agree on the selection,
each shall designate one physician and the two physicians shall
designate a third physician so that a determination of disability
may be made by the three physicians. Fees and expenses of the
physicians and other experts and costs of examinations of the
Executive shall be shared equally by the Company and the
Executive. The decision as to the Executive's Disability made
by such physician or physicians shall be binding on the Company and
the Executive.
i.
"Discount Rate" means 120% of the applicable Federal rate
determined under Section 1274(d) of the Code and the regulations
thereunder at the time the relevant payments are made.
j.
“Employment Agreement” shall mean an agreement so
styled providing for continuation of salary and bonus payments
under certain circumstances and entered into between Ralcorp and
Executive contemporaneously with the execution of this
Agreement.
k.
“Excise Tax” as defined in Section 7.
l.
“Gross-Up Payment” as defined in Section 7.
m.
"Involuntary Termination" shall be any termination of the
Executive's employment with the Company (a) to which the Executive
objects orally or in writing or (b) which follows any of the
following:
(i)
without the express written consent of the Executive, (a) the
assignment of the Executive to any duties materially inconsistent
with the Executive's positions, duties, responsibilities and status
immediately prior to the Change in Control or (b) a material change
in the Executive's titles, offices, or reporting responsibilities
as in effect immediately prior to the Change in Control and with
respect to either (a) or (b) the situation is not remedied within
thirty (30) days after the receipt by the Company of written notice
by the Executive; provided, however, (a) and (b) herein shall not
constitute an "Involuntary Termination" if either situation is in
connection with the Executive's death or disability.
(ii) without
the express written consent of the Executive, a reduction in the
Executive's annual salary or opportunity for total annual
compensation in effect immediately prior to the Change in Control
which is not remedied within thirty (30) days after receipt by the
Company of written notice by the Executive.
(iii) without the
express written consent of the Executive, the Executive is required
to be based anywhere other than the Executive’s office
location immediately preceding the Change in Control, except for
required travel on business to an extent substantially consistent
with the business travel obligations of the Executive immediately
preceding the occurrence of the Change in Control.
(iv) without the
express written consent of the Executive, following the Change in
Control (a) failure by the Company or its successor or assigns to
provide to the Executive any material benefit or compensation plan,
stock ownership plan, stock purchase plan, stock based incentive
plan, defined benefit pension plan, defined contribution pension
plan, life insurance plan, health and accident plan, or disability
plan in which the Executive is participating or entitled to
participate at the time of the Change in Control (or plans
providing substantially similar benefits) or in which executive
officers of the ultimate parent entity acquiring the Company
are entitled to participate (whichever are more favorable); or (b)
the taking of any action by the Company that would (1) adversely
affect the participation in or materially reduce the benefits under
any of such plans either in terms of the amount of benefits
provided or the level of the Executive's participation relative to
other participants; (2) deprive the Executive of any material
fringe benefit enjoyed by the Executive at the time of the Change
in Control; or (3) cause a failure to provide the number of paid
vacation days to which the Executive was then entitled in
accordance with Ralcorp's normal vacation policy in effect
immediately prior to the Change in Control, which in either
situation (a) or (b) is not remedied within thirty (30) days after
receipt by the Company of written notice by the Executive.
(v) the
liquidation, dissolution, consolidation, or merger of the Company
or transfer of all or substantially all of its assets, unless a
successor or successors (by merger, consolidation, or otherwise) to
which all or a significant portion of its assets have been
transferred expressly assumes in writing all duties and obligations
of the Company as here set forth.
(vi) the failure by
the Company or its successor or assigns (whether by purchase,
merger, consolidation or otherwise) to expressly assume and agree
to perform this Agreement after a Change in Control.
The Executive's continued employment shall not constitute consent
to, or a waiver of rights with respect to any circumstances set
forth above.
n.
“Non Compete Effective Date” shall mean the date on
which the Company or any entity on its behalf shall pay the
Executive all of the severance benefits to which the Executive is
entitled under paragraph a and b of Section 3 hereunder.
o.
"Normal Retirement Date" shall be the date on which the Executive
attains age 65.
p.
“Payment” as defined in Section 7.
q.
The "Payment Period" shall be the following period commencing with
the first day of the month following that in which a Qualifying
Termination occurs:
(i) if
the Qualifying Termination is an Involuntary Termination that
occurs at any time during the first or second year following the
Change in Control -- 36 months;
(ii) if the
Qualifying Termination is an Involuntary Termination that occurs at
any time during the third year following the Change in Control --
24 months;
(iii) if
the Qualifying Termination is a Voluntary Termination that occurs
at any time between six months following a Change in Control and
two years following the Change in Control -- 12 months; or
(iv) if the
Qualifying Termination is a Voluntary Termination that occurs
within six months following a change in control – 24
months.
but in no event shall the Payment Period extend beyond the
Executive’s Normal Retirement Date.
r.
"Qualifying Termination" shall be the Executive's Voluntary
Termination or Involuntary Termination of employment with the
Company except any termination because of the Executive's death,
retirement at or after the Executive’s Normal Retirement Date
or Termination for Cause. "Qualifying Termination" shall not
include any change in the Executive's employment status due to
Disability.
s.
"Retirement Plan" means the Ralcorp Holdings, Inc. Retirement Plan
or any successor qualified plan, as amended from time to time.
t.
"Stock" means the common stock of Ralcorp or such other security
entitling the holder to vote at the election of Ralcorp's directors
or any other security outstanding upon its reclassification,
including, without limitation, any stock split-up, stock dividend
or other recapitalization of Ralcorp or any merger or consolidation
of Ralcorp with any of its Affiliates.
u.
"Supplemental Plan" means the Ralcorp Holdings, Inc. Supplemental
Retirement Plan as amended from time to time.
v.
"Termination for Cause" shall be a termination because of:
(i) the
continued failure by the Executive to devote reasonable time and
effort to the performance of the Executive’s duties (other
than any such failure resulting from the Executive's incapacity due
to physical or mental illness) after written demand therefor has
been delivered to the Executive by the Company that specifically
identifies how the Executive has not devoted reasonable time and
effort to the performance of the Executive’s duties; or
(ii) the
willful engaging by the Executive in misconduct which is materially
injurious to the Company, monetarily or otherwise; or
(iii) the
Executive’s conviction of a felony or a crime involving moral
turpitude;
in any case as determined by the Board upon the good faith vote of
not less than a majority of the directors then in office, after
reasonable notice to the Executive specifying in writing the basis
or bases for the proposed Termination for Cause and after the
Executive has been provided an opportunity to be heard before a
meeting of the Board held upon reasonable notice to all directors;
provided, however, that a Termination for Cause shall not include a
termination attributable to:
(i) bad
judgment or negligence on the part of the Executive other than
habitual negligence; or
(ii) an act
or omission believed by the Executive in good faith to have been in
or not opposed to the best interests of the Company and reasonably
believed by the Executive to be lawful; or
(iii) the good
faith conduct of the Executive in connection with a Change in
Control (including the Executive’s opposition to or support
thereof).
