EXHIBIT 10.3
ConAgra Foods, Inc.
One ConAgra Drive
Omaha, NE
68102-5501
TEL: 402-595-4000
September 22, 2005
Mr. Bruce Rohde
ConAgra Foods, Inc.
One ConAgra Drive
Omaha, NE 68102
Dear Bruce:
This
letter summarizes and confirms the agreements regarding your
transition from the role of Chairman,
Chief Executive
Officer, and President,
and your employment status and arrangements
thereafter with
ConAgra Foods, Inc.
(the "Company").
Recognizing
the Company has now
recruited and elected a CEO and President,
and elected a non-executive Chairman both
to commence their respective duties on
October 1, 2005, your official resignation date as Chairman,
CEO and President
and, except as provided herein, all other
executive positions
and directorships
with the Company and any of the
Company's subsidiaries will be September 30,
2005 (the "Resignation Date"). On that date, you will
deliver your resignation
of the positions of Chairman,
CEO and President of
the Company and the Company
will accept your resignation letter to the Company per the Good Reason
provisions of your Employment Agreement
dated August 26, 1996, the Amendments to
the Employment Agreement dated December 23, 1996 and February 16, 1998
(the
"Employment Agreement").
1. Salary and Incentives:
Through
September 30, 2005, you will continue in your role as
Chairman,
CEO, and President, and you will receive your regular base salary, paid in
accordance with the customary payroll practice in the monthly amount
equal to
$100,000, subject to applicable FICA and
income tax withholding obligations.
In addition to
the monthly salary described above, for fiscal year 2006 you
will also receive Long Term Incentive Awards of stock and cash under the
Long
Term Senior Management Incentive Plan
("LTSMIP") based on an award pool of 8% of
the Company's excess after-tax earnings
over and above 5% compound annual growth
rate from a fixed five-year average earnings base and both of which
will be
prorated to reflect the number of days from the
beginning of the fiscal year
through your Resignation Date. Such payments will be
calculated and paid in the
same manner as LTSMIP Awards have been
calculated
and paid in the past
for the
Company's other senior executive
officers participating in such plans,
except
that the stock and the cash awards payable to you will be immediately fully
vested and no longer be subject to any risk
of forfeiture.
For fiscal year 2006 you will also receive an award under the Annual
Management Incentive Plan ("MIP"), prorated for the fiscal year
through your
Resignation Date. The MIP Award will be based on the PBT
performance
scale
approved by the Human Resources Committee of the Board on July 25,
2005. This
award will not be restricted in any way and will not be subject to risk of
forfeiture.
The LTSMIP
Awards and the Annual MIP Award described above will be
subject
to applicable FICA and income tax
withholding obligations.
From your
Resignation
Date through
September 30, 2009 (the "Separation
Date"), you will be employed in a non-officer capacity, with the title of
Chairman and CEO Emeritus of the Company
(the "Employment
Period"), and
during
the Employment Period you will be paid half your
regular base salary,
paid in
accordance with the customary payroll practice in a monthly amount equal to
$50,000, subject to applicable FICA and
income tax withholding obligations (the
"Base Salary"); provided, however, that you shall not be entitled to
the Base
Salary so long as you, without good and
sufficient reason (i.e., being directed
to perform services inconsistent with the
Requested Services (as defined below))
or in the absence of a material breach of this Agreement by the Company,
willfully refuse to perform your duties and
obligations
contemplated hereunder.
If you are terminated for "Cause" (as defined in the
Employment Agreement)
the
Employment Period will end. It is understood
that after your
participation in
the fiscal year 2006 plans you will not
continue to participate in the Long Term
Senior Management Incentive Plans or the Annual Management Incentive Plan.
During the Employment Period, you will make yourself
reasonably
available to
furnish such information and background as may be reasonably necessary in
connection with any inquiry, investigation, dispute, litigation, regulatory
proceeding or other action in which the Company is or may become involved
insofar as it relates to matters arising
out of your employment. In that regard,
you will report to the Chairman of the Board of
Directors of the Company (the
"Chairman") and provide such services as reasonably, ethically and lawfully
requested by the Chairman, which services shall be consistent with the duties
and responsibilities of a senior officer of the Company and which you shall
provide in accordance with the Company's corporate governance and ethics
guidelines (the "Requested Services"). If you are called upon to serve as a
witness or provide assistance in or with respect to any such
proceeding,
you
agree to cooperate with the Company to the
full extent permitted by law, and the
Company agrees that any such call shall be with reasonable notice and shall
provide for payment for your costs
incurred in such
matters. Furthermore,
you
will promptly give written notice to the Company of any
inquiry, approach
or
other notice you receive or are informed of
by or from any
governmental
entity
regarding any inquiry, investigation,
dispute, litigation, regulatory proceeding
or other action involving the Company. Provided that you advise the Company
prior to engaging in any such action, the provisions of this letter and the
agreements herein shall not apply to or
restrict in any way the communication of
information by you to any state or federal
law enforcement agency or require
notice to the Company thereof. If during
the Employment Period or thereafter you
are requested to perform significant additional services, any additional
compensation would be agreed to between the
parties hereunder.
2. Health Benefits
Continuation:
During the
Employment
Period, you and your qualifying dependents will
receive the health benefits the Company
maintains for its executive officers at
no cost to you. You will be responsible for any taxes associated with the
premiums, co-payments and deductibles paid
on behalf of you and your qualifying
dependents during the Employment
Period. Upon the expiration of the
Employment
Period, you will be permitted to continue your Company medical and dental
benefits coverage for the maximum period permitted under the Consolidated
Omnibus Reconciliation Act of 1986, as
amended ("COBRA"), and
to participate in
the Company's post-retirement medical
programs, if any, pursuant to the terms of
such programs. If you should elect such
continuation
of Company
medical and
dental benefits coverage, you will be required to pay for
such coverage in an
amount not to exceed the then
normal amounts which may be charged for such
coverage under COBRA, provided that if you
are considered a retiree for purposes
of the Company's health plans, you shall
pay applicable retiree rates.
3. AD/D and LTD Coverage:
During the
Employment
Period, you will continue to receive the
same AD/D
and LTD coverage you had immediately
prior to your
Resignation Date at no
cost
to you.
4. Stock Options:
On your
Resignation Date, to
the extent previously
unvested, all of
your
employee stock options shall vest and no longer be subject to any risk of
forfeiture. You are entitled to exercise
these options until the end of their
respective terms subject to any adjustment
provisions on corporate transactions.
The Company shall be entitled to withhold
from the stock (or
stock proceeds in
the event of a cashless exercise)
applicable FICA and
income taxes with respect
to the exercises of any such stock options
granted to you by the Company.
5. Restricted Stock Awards and
Restricted Share Equivalent Units:
On your
Resignation Date, to
the extent previously
unvested, all of
your
restricted stock awards and restricted
share equivalent units shall vest, no
longer be subject to any risk of
forfeiture, and be
promptly delivered to
you,
subject to the provisions of Section 17
hereof. The Company shall be entitled to
withhold applicable FICA and income taxes
with respect to the vesting of any of
your restricted stock awards and share
equivalent
units granted to you
by the
Company.
6. Restricted Cash Awards:
On your
Resignation Date, to
the extent previously
unvested, all of
your
restricted cash awards shall vest, no longer be subject to any risk of
forfeiture, and be promptly paid to you,
subject to the provisions of Section 17
hereof. The Company shall be entitled to withhold
applicable
FICA and income
taxes with respect to the vesting of any of
your restricted cash
awards granted
to you by the Company.
7. Other Benefits Programs:
During the
Employment Period, you will continue to participate in all
other
benefit programs maintained by the Company
for its executive officers, which as
of the date hereof include the ConAgra
Foods Retirement Income Savings Plan, the
Non-Qualified ConAgra Foods Retirement Income Savings Plan, the ConAgra
Foods
Inc. Voluntary Deferred Compensation Plan,
the ConAgra Pension Plan for Salaried
Employees and the ConAgra Nonqualified
Pension Plan.
a. Non-Qualified Pension
Plan:
During the Employment
Period, you will continue to participate in the
Company's
Non-Qualified
Pension Plan.
Your benefits under the plan are
fully
vested and
non-forfeitable.
You are entit
