-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QkfejShxQoZq7ReIbXKwSulUZf6Q+P5FVU8E3f6eMhc0602uY8Wn908Ioq9skquf gSjfIXNUqUHiroPUkY9NyQ== 0000950134-02-007071.txt : 20020611 0000950134-02-007071.hdr.sgml : 20020611 20020611160736 ACCESSION NUMBER: 0000950134-02-007071 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 20020611 EFFECTIVENESS DATE: 20020611 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FLEMING COMPANIES INC /OK/ CENTRAL INDEX KEY: 0000352949 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-GROCERIES & GENERAL LINE [5141] IRS NUMBER: 480222760 STATE OF INCORPORATION: OK FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-90238 FILM NUMBER: 02676523 BUSINESS ADDRESS: STREET 1: 1945 LAKEPOINTE DRIVE CITY: LEWISVILLE STATE: TX ZIP: 73126 BUSINESS PHONE: 4058407200 MAIL ADDRESS: STREET 1: 1945 LAKEPOINT DRIVE CITY: LEWISVILLE STATE: TX ZIP: 75057 S-8 1 d97628sv8.txt FORM S-8 United States Securities and Exchange Commission Washington, D.C. 20549 FORM S-8 Registration Statement under the Securities Act of 1933 FLEMING COMPANIES, INC. (Exact name of registrant as specified in its charter) Oklahoma 48-0222760 (State of incorporation) (I.R.S. Employer Identification No.) P.O. Box 299013 1945 Lakepointe Drive Lewisville, Texas 75029 (Address of Principal Executive Office) FLEMING COMPANIES, INC. 2002 STOCK INCENTIVE PLAN FLEMING COMPANIES, INC. 2002 ASSOCIATE STOCK PURCHASE PLAN FLEMING COMPANIES, INC. 2002 AIM HIGH PLUS INCENTIVE PLAN NON-QUALIFIED STOCK OPTION AGREEMENT WITH TIMOTHY LABEAU NON-QUALIFIED STOCK OPTION AGREEMENT J.R. CAMPBELL (Full title of the plans) Carlos M. Hernandez Senior Vice President, General Counsel and Secretary Fleming Companies, Inc. P.O. Box 299013 1945 Lakepointe Drive Lewisville, Texas (Name and address of agent for service) 972-906-8000 (Telephone number, including area code, of agent for service) Calculation of Registration Fee
Proposed maximum Proposed maximum Title of securities to Amount to be offering price per aggregate offering Amount of be registered registered unit price registration fee ---------------------- ------------ ------------------ ------------------ ---------------- Common Stock, $2.50 par 3,500,000 shares(2) $20.81(1) $72,835,000(1) $6,700.82 value Common Stock, $2.50 par 1,800,000 shares(2) $20.81(1) (3) $37,458,000(1) (3) $3,446.14 value Common Stock, $2.50 par 750,000 shares(2) $20.81(1) $15,607,500(1) $1,435.89 value Common Stock, $2.50 par 200,000 shares $20.155 $4,031,000 $370.85 value Common Stock, $2.50 par 100,000 shares $19.10 $1,910,000 $175.72 value Total 6,350,000 $131,841,500 $12,129.22
- ---------- (1) Estimated pursuant to Rules 457(c) and (h) of the Securities Act of 1933, as amended, solely for the purpose of calculating the registration fee and based upon the average of the high and low prices of Fleming Companies, Inc. Common Stock as reported by the New York Stock Exchange on June 4, 2002. (2) The number of shares of Common Stock stated above is the aggregate number of such shares which may be issued (including shares which may be issued upon exercise of options) under each of the plans registered under this Registration Statement. The maximum number of shares which may be issued under the plans cannot presently be determined as adjustments in the number of shares may be made in the event of stock splits, stock dividends, or other changes in the corporate structure or shares as specified in the plans. Accordingly, this Registration Statement covers, in addition to the number of shares of Common Stock stated above, an indeterminate number of shares, which by reason of any of such event may become subject to issuance under the plans. (3) In accordance with the calculation of the offering price under the 2002 Associate Stock Purchase Plan, the average price for the Common Stock is multiplied by a factor of .85 to arrive at the maximum offering price. PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS Item 1. Plan Information (1) Item 2. Registrant Information and Employee Plan Annual Information (1) - ---------- (1) Information required by Part I to be contained in the Section 10(a) prospectus is omitted from this Registration Statement in accordance with the Note to Part I of Form S-8 and has been or will be sent or given to participants in the Plan as specified in Rule 428(b)(1). PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference. The registrant incorporates herein by reference the following documents filed with the Securities and Exchange Commission (the "Commission"): (1) The registrant's Annual Report on Form 10-K for the fiscal year ended December 29, 2001. (2) The registrant's Form 10-Q for the period ended April 20, 2002; and the registrant's current reports on Form 8-K filed April 24, 2002 and May 20, 2002, as amended on Form 8-K/A filed May 29, 2002. (3) The description of Common Stock contained in the registrant's Registration Statement on Form 8-A, as amended, filed under the Exchange Act on April 19, 1983 (File No. 1-8140), including any amendments or reports filed for the purpose of updating such description. All documents filed by the registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the filing of a post-effective amendment which indicates that all of the shares of the registrant's Common Stock covered by this registration statement have been sold or which deregisters all such shares then remaining unsold, shall be deemed to be incorporated herein by reference and to be a part hereof from the date of filing of such documents. Item 4. Description of Securities. Not applicable. Item 5. Interests of Named Experts and Counsel. Not applicable. Item 6. Indemnification of Directors and Officers. Section 1031 of the Oklahoma General Corporation Act, under which act the registrant is incorporated, authorizes the indemnification of officers and directors in certain circumstances. Article Thirteen of the registrant's Restated Certificate of Incorporation, as well as Section 8.3 of the registrant's Bylaws, provide indemnification of directors, officers and agents to the extent permitted by Oklahoma General Corporation Act. These provisions may be sufficiently broad to indemnify such persons for liabilities under the Securities Act of 1933. In addition, Article Thirteen of the registrant's Restated Certificate of Incorporation permits the exculpation II-1 of a director for monetary damages for breach of fiduciary duty as a director. In addition, the registrant maintains insurance policies that insure its officers and directors against certain liabilities. Item 7. Exemption from Registration Claimed. Not applicable. Item 8. Exhibits. 4.1 Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the registrant's Quarterly Report on Form 10-Q for quarter ended April 17, 1999). 4.2 Bylaws (incorporated by reference to Exhibit 3.2 to the registrant's Quarterly Report on Form 10-Q for quarter ended April 17, 1999). 5 Opinion of McAfee & Taft A Professional Corporation. 15 Letter from Independent Accountants as to Unaudited Interim Financial Information. 23.1 Consent of McAfee & Taft A Professional Corporation (included in Exhibit 5). 23.2 Consent of Deloitte & Touche LLP. 24.1 Power of Attorney (included on signature page). 99.1 Fleming Companies, Inc. 2002 Stock Incentive Plan, effective as of February 27, 2002 (incorporated by reference to Exhibit A to registrant's Proxy Statement for the fiscal year ended December 29, 2002). 99.2 Form of Non-Qualified Stock Option Agreement under Fleming Companies, Inc. 2002 Stock Incentive Plan (Corporate). 99.3 Form of Non-Qualified Stock Option Agreement under Fleming Companies, Inc. 2002 Stock Incentive Plan (Retail) 99.4 Form of Non-Qualified Stock Option Agreement under Fleming Companies, Inc. 2002 Stock Incentive Plan (Wholesale) 99.5 Fleming Companies, Inc. 2002 Associate Stock Purchase Plan, effective as of July 1, 2002 (incorporated by reference to Exhibit B to registrant's Proxy Statement for the fiscal year ended December 29, 2002). 99.6 Fleming Companies, Inc. 2002 AIM High Plus Incentive Plan, effective as of February 27, 2002 (incorporated by reference to Exhibit D to registrant's Proxy Statement for the fiscal year ended December 29, 2002). 99.7 Non-Qualified Stock Option Agreement by and between registrant and Timothy LaBeau dated December 30, 2001. 99.8 Non-Qualified Stock Option Agreement by and between registrant and J.R. Campbell dated December 18, 2001. Item 9. Undertakings. The undersigned registrant hereby undertakes: II-2 1. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference herein. 2. That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. 3. To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference herein shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefor, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Lewisville, State of Texas, on the 11th day of June, 2002. (Registrant) FLEMING COMPANIES, INC. By: /s/ CARLOS M. HERNANDEZ ------------------------------------------- Carlos M. Hernandez Senior Vice President, General Counsel and Secretary We, the undersigned officers and directors of Fleming Companies, Inc. (hereinafter the "Company"), hereby severally constitute Mark S. Hansen and Carlos M. Hernandez, and each of them, severally, our true and lawful attorneys-in-fact with full power to them and each of them to sign for us, and in our names as officers or directors, or both, of the Company, this registration statement on Form S-8 (and any and all amendments thereto, including post-effective amendments) to be filed with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and to perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the date indicated.
Signature Title Date - --------- ----- ---- /s/ MARK S. HANSEN Chairman of the Board and Chief ) - -------------------------------------- Executive Officer ) Mark S. Hansen ) ) /s/ NEAL J. RIDER Executive Vice President and Chief ) - -------------------------------------- Financial Officer (principal ) Neal J. Rider financial officer) ) ) /s/ MARK D. SHAPIRO Senior Vice President, Finance and ) - -------------------------------------- Operations Control (principal ) June 11th, 2002 Mark D. Shapiro accounting officer) ) ) /s/ HERBERT M. BAUM Director ) - -------------------------------------- ) Herbert M. Baum ) ) Director ) - -------------------------------------- ) Kenneth M. Duberstein ) ) /s/ ARCHIE R. DYKES Director ) - -------------------------------------- ) Archie R. Dykes ) ) Director ) - -------------------------------------- ) Carol B. Hallett ) ) /s/ ROBERT S. HAMADA Director ) - -------------------------------------- ) Robert S. Hamada ) ) /s/ ALICE M. PETERSON Director ) - -------------------------------------- ) Alice M. Peterson )
INDEX TO EXHIBITS
Exhibit No. 4.1 Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to registrant's Quarterly Report on Form 10-Q for quarter ended April 17, 1999). 4.2 Bylaws (incorporated by reference to Exhibit 3.2 to the registrant's Quarterly Report on Form 10-Q for quarter ended April 17, 1999). 5 Opinion of McAfee & Taft A Professional Corporation. 15 Letter from Independent Accountants as to Unaudited Interim Financial Information. 23.1 Consent of McAfee & Taft A Professional Corporation (included in Exhibit 5). 23.2 Consent of Deloitte & Touche LLP. 24.1 Power of Attorney (included on signature page). 99.1 Fleming Companies, Inc. 2002 Stock Incentive Plan, effective as of February 27, 2002 (incorporated by reference to Exhibit A to registrant's Proxy Statement for the fiscal year ended December 29, 2002). 99.2 Form of Non-Qualified Stock Option Agreement under Fleming Companies, Inc. 2002 Stock Incentive Plan (Corporate). 99.3 Form of Non-Qualified Stock Option Agreement under Fleming Companies, Inc. 2002 Stock Incentive Plan (Retail). 99.4 Form of Non-Qualified Stock Option Agreement under Fleming Companies, Inc. 2002 Stock Incentive Plan (Wholesale). 99.5 Fleming Companies, Inc. 2002 Associate Stock Purchase Plan, effective as of July 1, 2002 (incorporated by reference to Exhibit B to registrant's Proxy Statement for the fiscal year ended December 29, 2002). 99.6 Fleming Companies, Inc. 2002 AIM High Plus Incentive Plan, effective as of February 27, 2002 (incorporated by reference to Exhibit D to registrant's Proxy Statement for the fiscal year ended December 29, 2002). 99.7 Non-Qualified Stock Option Agreement by and between registrant and Timothy LaBeau dated December 30, 2001. 99.8 Non-Qualified Stock Option Agreement by and between registrant and J.R. Campbell dated December 18, 2001.
EX-5 3 d97628exv5.txt OPINION/CONSENT OF MCAFEE & TAFT EXHIBIT 5 LAW OFFICES McAfee & Taft A PROFESSIONAL CORPORATION 10TH FLOOR, TWO LEADERSHIP SQUARE 211 NORTH ROBINSON OKLAHOMA CITY, OKLAHOMA 73102-7103 (405) 235-9621 FAX (405) 235-0439 http://www.mcafeetaft.com June 11, 2002 Fleming Companies, Inc. 1945 Lakepointe Drive Lewisville, Texas 75057-6424 Re: Registration Statement on Form S-8 Ladies and Gentlemen: Reference is made to your Registration Statement on Form S-8 to be filed with the Securities and Exchange Commission today with respect to: o 3,500,000 shares of common stock, $2.50 par value per share (the "Common Stock"), to be issued pursuant to the Fleming Companies, Inc. 2002 Stock Incentive Plan, o 1,800,000 shares of Common Stock to be issued pursuant to the Fleming Companies, Inc. 2002 Associate Stock Purchase Plan, o 750,000 shares of Common Stock to be issued pursuant to the Fleming Companies, Inc. 2002 AIM High Plus Incentive Plan (collectively, the "Plans"), o 100,000 shares of Common Stock to be issued pursuant to the Non-Qualified Stock Option Agreement by and between Fleming Companies, Inc. (the "Company") and Timothy La Beau dated December 30, 2001, and o 200,000 shares of Common Stock to be issued pursuant to the Non-Qualified Stock Option Agreement by and between the Company and J.R. Campbell dated December 18, 2001. We have examined your corporate records and made such other investigations as we deemed appropriate for the purpose of this opinion. Based upon the foregoing, we are of the opinion that: 1. Fleming Companies, Inc. (the "Company") has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Oklahoma. 2. The issuance of the Common Stock has been duly authorized by appropriate corporate action on behalf of the Company. 3. When issued and paid for pursuant to the Plans, the Common Stock will be validly issued, and will be fully paid and non-assessable. We hereby consent to the inclusion of this opinion as an exhibit to the above mentioned Registration Statement. Very Truly Yours, MCAFEE & TAFT A PROFESSIONAL CORPORATION EX-15 4 d97628exv15.txt LETTER RE: UNAUDITED INTERIM FINANCIAL INFORMATION EXHIBIT 15 [D&T LETTERHEAD, DALLAS, TEXAS] June 10, 2002 Fleming Companies, Inc. 1945 Lakepointe Drive Lewisville, Texas 75057-6424 We have made a review, in accordance with standards established by the American Institute of Certified Public Accountants, of the unaudited interim financial information of Fleming Companies, Inc. and subsidiaries for the period ended April 20, 2002, as indicated in our report dated May 7, 2002; because we did not perform an audit, we expressed no opinion on that information. We are aware that our report referred to above, which is included in your Quarterly Report on Form 10-Q for the quarter ended April 20, 2002, is being used in this Registration Statement. We also are aware that the aforementioned report, pursuant to Rule 436(c) under the Securities Act of 1933, is not considered a part of the Registration Statement prepared or certified by an accountant, or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act. DELOITTE & TOUCHE LLP EX-23.2 5 d97628exv23w2.txt CONSENT OF DELOITTE & TOUCHE LLP Exhibit 23.2 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Registration Statement of Fleming Companies, Inc. on Form S-8 of our report dated February 23, 2002 appearing in the Annual Report on Form 10-K of Fleming Companies, Inc. and subsidiaries for the year ended December 29, 2001. DELOITTE & TOUCHE LLP Dallas, Texas June 11, 2002 EX-99.2 6 d97628exv99w2.txt FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT Corporate FLEMING COMPANIES, INC. 2002 STOCK INCENTIVE PLAN - -------------------------------------------------------------------------------- NON-QUALIFIED STOCK OPTION AGREEMENT - -------------------------------------------------------------------------------- Name: Grant Date: Option Price: Exercise Date: 25% Shares Granted: 50% Expiration Date: 75% 100% THIS AGREEMENT WILL BE VOID UNLESS FULLY EXECUTED WITHIN TWENTY- ONE (21) DAYS OF RECEIPT BY THE PARTICIPANT. NON-QUALIFIED STOCK OPTION AGREEMENT UNDER THE FLEMING COMPANIES, INC. 2002 STOCK INCENTIVE PLAN THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the "Option Agreement"), made as of this ____ day ______________, _____, at Lewisville, Texas by and between _______________ (hereinafter referred to as the "Participant"), and Fleming Companies, Inc. (hereinafter referred to as the "Company"): W I T N E S S E T H: WHEREAS, the Participant is an "Eligible Associate" of the Company, as such term is defined in the Plan, and it is important to the Company that the Participant be encouraged to remain in the employ of the Company and given incentive to perform while in the employ of the Company; and WHEREAS, as an ancillary part of this Option Agreement, it is also important to the Company to protect its legitimate business interests if the Participant leaves the employ of the Company; and WHEREAS, in recognition of such facts, the Company desires to provide to the Participant an opportunity to purchase shares of the common stock of the Company, as hereinafter provided, pursuant to the "Fleming Companies, Inc. 2002 Stock Incentive Plan" (the "Plan"); and WHEREAS, the Participant is a "Non-Executive Officer Participant" as such term is defined in the Plan, and the Regular Award Committee has made this Award as permitted by Section 3 of the Plan. NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for good and valuable consideration, the Participant and the Company hereby agree as follows: 1. GRANT OF STOCK OPTION. The Company hereby grants to the Participant Nonqualified Stock Options (the "Stock Options") to purchase all or any part of an aggregate of _______ shares of Common Stock under and subject to the terms and conditions of this Option Agreement and the Plan, which is incorporated herein by reference and made a part hereof for all purposes. All capitalized terms used in this Option Agreement shall have the same meaning ascribed to them in the Plan unless specifically denoted otherwise. The purchase price per share for each share of Common Stock to be purchased hereunder shall be $________ (the "Option Price"). 2. TIMES OF EXERCISE OF STOCK OPTION. After, and only after, the conditions of Section 8 hereof have been satisfied, the Participant shall be eligible to exercise that portion of his/her Stock Options pursuant to the schedule set forth hereinafter. If the Participant's employment with the Company (or of any one or more of the Subsidiaries of the Company) remains full-time and continuous at all times prior to any of the "Exercise Dates" set forth in this Section 2, then the Participant shall be entitled, subject to the applicable provisions of the Plan and this Option Agreement having been satisfied, to exercise on or after the applicable Exercise Date, on a cumulative basis, the number of shares of Stock determined by multiplying the aggregate number of shares set forth in Section 1 of this Option Agreement by the designated percentage set forth below. Percent of Stock Exercise Dates Option Exercisable - -------------------------------------------------------------------------------- On or After ______________ 25% On or After ______________ 50% On or After ______________ 75% On or After ______________ 100% 3. TERM OF STOCK OPTION. Except as provided for in Section 4 of this Option Agreement, none of the Stock Options shall be exercisable more than ten years from the Date of Grant (the "Option Period"). 4. SPECIAL RULES WITH RESPECT TO STOCK OPTIONS. With respect to the Stock Options, the following special rules shall apply: (a) Exercise of Exercisable Stock Options on Termination of Employment. Except as provided to the contrary in the Plan or in this Option Agreement, if a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period for any reason other than death or retirement, he/she may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of such termination at any time within three months from the date of termination; provided, however, that if the Participant should die during such three month period, the rights of his/her personal representative shall be as set forth in Section 4(b) of this Option Agreement. (b) Exercise of Exercisable Stock Options on Termination of Employment Due to Death. If a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period due to his/her death, the personal representative of the deceased Participant may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of death within 12 months from the date of death. (c) Exercise of Exercisable Stock Options on Termination of Employment Due to Retirement. If a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated due to retirement in accordance with the Company's retirement policies, the Participant shall have a period of three years following his/her date of retirement to exercise the Stock Options which are otherwise exercisable on his/her date of retirement. (d) Acceleration of Otherwise Unexercisable Stock Options on Termination of Employment. The Committee, in its sole discretion, may determine that upon termination of the employment of a Participant any and all Stock Options shall become automatically fully vested and immediately exercisable by the Participant or his/her personal 2 representative as the case may be for whatever period following such termination as the Committee shall so decide. (e) Acceleration of Options Upon Change of Control. Upon the occurrence of a Change of Control Event, any and all Stock Options will become automatically fully vested and immediately exercisable with such acceleration to occur without the requirement of any further act by either the Company or the Participant. 5. NON-TRANSFERABILITY OF STOCK OPTIONS. Except as provided in Section 9.3 of the Plan regarding certain limited transferability of Stock Options with the Committee's approval, Stock Options shall be transferable only by will or the laws of descent and distribution; however, no such transfer of the Stock Options by the Participant shall be effective to bind the Company unless the Company shall have been furnished with written notice of such transfer and an authenticated copy of the will and/or such other evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee of the terms and conditions of such Option. 6. EMPLOYMENT. So long as the Participant shall continue to be a full-time and continuous employee of the Company or a Subsidiary, the Stock Options shall not be affected by any change of duties or position. Nothing in the Plan or in this Option Agreement shall confer upon the Participant any right to continue in the employ of the Company, any of the Subsidiaries, or any Affiliated Entities or interfere in any way with the right of the Company, any of the Subsidiaries or any Affiliated Entities to terminate such Participant's employment at any time. 7. METHOD OF EXERCISING STOCK OPTION. (a) Procedures for Exercise. The manner of exercising the Stock Options shall be by written notice to the Company at least two days before the date the Stock Option, or part thereof, is to be exercised, and in any event prior to the expiration of the Option Period. Such notice shall state the election to exercise the Stock Options and the number of shares of Common Stock with respect to that portion of the Stock Options being exercised, and shall be signed by the person or persons so exercising the Stock Options. The notice shall be accompanied by payment of the full purchase price of such shares, in which event the Company shall provide a book-entry registration or certificates representing such shares to the person or persons entitled thereto as soon as practicable after the notices have been received. (b) Form of Payment. Payment for shares of Common Stock purchased under this Option Agreement shall be made in full by the Participant in any manner specified in Section 6.2(b) of the Plan. No Common Stock shall be issued to the Participant until the Company receives full payment for the Common Stock purchased under the Stock Options which shall include any required state and federal withholding taxes. Withholding taxes may be paid by the Participant in any manner specified in Section 9.4 of the Plan. (c) Further Information. In the event the Stock Options are exercised, pursuant to the foregoing provisions of this Section 7, by any person or persons other than the Participant in the event of the death of the Participant, the notice of election to exercise shall also be 3 accompanied by appropriate proof of the right of such person or persons to exercise the Stock Options. 8. SECURITIES LAW RESTRICTIONS. Stock Options shall be exercised and Common Stock issued only upon compliance with the Securities Act of 1933, as amended, and any other applicable securities law, or pursuant to an exemption therefrom. 9. NOTICES. All notices or other communications relating to the Plan and this Option Agreement as it relates to the Participant or, in event of the death of the Participant, his/her personal representative shall be in writing and shall be mailed (U.S. Mail) by the Company to the Participant or his/her personal representative, as the case may be, at the then current address as maintained by the Company or such other address as the Participant or his/her personal representative may advise the Company in writing. All other notices shall be given by personal delivery to the Secretary of the Company or by registered or certified mail at his/her principal office or at such other address as the Company may hereafter advise the Participant or his/her personal representative, and it shall be deemed to have been given when they are so personally delivered or when they are deposited in the United States mail in an envelope addressed to the Company, properly stamped for delivery as a registered or certified letter. 10. PROTECTION OF COMPANY BUSINESS AS CONSIDERATION. AS SPECIFIC CONSIDERATION TO THE COMPANY FOR THE STOCK OPTIONS, THE PARTICIPANT AGREES: (a) LIMITATIONS ON COMPETITION. SUBJECT TO SUBSECTION (g), THE PARTICIPANT WILL NOT, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, BE A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF SUPERVALU, INC., NASH FINCH COMPANY OR ANY OTHER DIRECT COMPETITOR OF THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY EXCLUDING NATIONAL RETAIL CHAINS, OR ANY OF THEIR RESPECTIVE SUBSIDIARIES, AFFILIATES OR SUCCESSORS (COLLECTIVELY, THE "COMPETITORS"). (b) CONFIDENTIAL INFORMATION; NO DISPARAGING STATEMENTS. THE PARTICIPANT ACKNOWLEDGES THAT DURING THE COURSE OF THE PARTICIPANT'S EMPLOYMENT WITH THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY, HE/SHE WILL HAVE ACCESS TO AND GAIN KNOWLEDGE OF HIGHLY CONFIDENTIAL AND PROPRIETARY INFORMATION AND TRADE SECRETS. THE PARTICIPANT FURTHER ACKNOWLEDGES THAT THE MISUSE, MISAPPROPRIATION OR DISCLOSURE OF THIS INFORMATION COULD CAUSE IRREPARABLE HARM TO THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY, BOTH DURING AND AFTER THE TERM OF THE PARTICIPANT'S EMPLOYMENT. THEREFORE, THE PARTICIPANT AGREES, DURING HIS/HER EMPLOYMENT AND AT ALL TIMES THEREAFTER, HE/SHE WILL HOLD IN A FIDUCIARY CAPACITY FOR THE BENEFIT OF THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY AND WILL NOT DIVULGE OR DISCLOSE, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON, FIRM OR BUSINESS, ALL CONFIDENTIAL OR PROPRIETARY INFORMATION, KNOWLEDGE AND DATA (INCLUDING, BUT NOT LIMITED TO, PROCESSES, PROGRAMS, TRADE "KNOW HOW," IDEAS, DETAILS OF CONTRACTS, MARKETING PLANS, STRATEGIES, BUSINESS DEVELOPMENT TECHNIQUES, BUSINESS ACQUISITION PLANS, PERSONNEL PLANS, PRICING PRACTICES AND BUSINESS METHODS AND PRACTICES) RELATING IN ANY WAY TO THE BUSINESS OF THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY, CUSTOMERS, SUPPLIERS, JOINT VENTURES, LICENSORS, LICENSEES, DISTRIBUTORS AND OTHER PERSONS AND ENTITIES WITH WHOM THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DO BUSINESS ("CONFIDENTIAL DATA"), EXCEPT UPON THE COMPANY'S WRITTEN CONSENT OR AS REQUIRED BY HIS/HER DUTIES WITH THE COMPANY, ITS 4 SUBSIDIARIES OR AFFILIATED ENTITIES, FOR SO LONG AS SUCH CONFIDENTIAL DATA REMAINS CONFIDENTIAL AND ALL SUCH CONFIDENTIAL DATA, TOGETHER WITH ALL COPIES THEREOF AND NOTES AND OTHER REFERENCES THERETO, SHALL REMAIN THE SOLE PROPERTY OF THE COMPANY, A SUBSIDIARY OR AN AFFILIATED ENTITY. THE PARTICIPANT AGREES, DURING HIS/HER EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND AT ALL TIMES THEREAFTER, NOT TO MAKE DISPARAGING STATEMENTS ABOUT THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES OR THEIR OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, PRODUCTS OR SERVICES WHICH HE/SHE KNOWS, OR HAS REASON TO KNOW, ARE FALSE OR MISLEADING. (c) NO SOLICITATION OF EMPLOYEES OR BUSINESS. THE PARTICIPANT AGREES THAT HE/SHE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, RECRUIT, SOLICIT OR INDUCE, OR ATTEMPT TO INDUCE, ANY EMPLOYEES OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES TO TERMINATE THEIR EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND/OR BECOME ASSOCIATED WITH ANOTHER EMPLOYER. THE PARTICIPANT FURTHER AGREES THAT HE/SHE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, SOLICIT, DIVERT OR TAKE AWAY, OR ATTEMPT TO DIVERT OR TAKE AWAY, THE BUSINESS OF ANY OF THE CUSTOMERS OR ACCOUNTS OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES WHICH THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY HAD OR WAS ACTIVELY SOLICITING BEFORE AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION. (d) TERM OF THE PARTICIPANT'S PROMISES UNDER THIS SECTION. THE PARTICIPANT AGREES THAT EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (b), HIS/HER PROMISES CONTAINED IN THIS SECTION 10 SHALL CONTINUE IN EFFECT DURING HIS/HER EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND UNTIL THE FIRST ANNIVERSARY OF HIS/HER TERMINATION/SEPARATION. (e) CONSEQUENCES OF BREACH OF LIMITATIONS ON COMPETITION AND/OR OTHER COMPETING EMPLOYMENT. SUBJECT TO SUBSECTION (g), IF AT ANY TIME WITHIN (i) THE TERM OF THIS OPTION AGREEMENT OR (ii) WITHIN ONE (1) YEAR FOLLOWING THE PARTICIPANT'S DATE OF TERMINATION/SEPARATION, BUT ONLY IF SUCH TERMINATION/SEPARATION OCCURS ON A DATE WHICH IS PRIOR TO TEN (10) YEARS FROM THE DATE OF THIS OPTION AGREEMENT, OR (iii) WITHIN ONE (1) YEAR AFTER HE/SHE EXERCISES ANY PORTION OF THE STOCK OPTIONS, WHICHEVER IS LATEST, THE PARTICIPANT IS, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF ANY OF THE COMPETITORS, THEN (iv) THE STOCK OPTIONS SHALL TERMINATE EFFECTIVE THE DATE THE PARTICIPANT ENTERS INTO SUCH ACTIVITY (UNLESS TERMINATED SOONER BY OPERATION OF ANOTHER TERM OR CONDITION OF THIS OPTION AGREEMENT OR THE PLAN), AND (v) ANY GAIN REPRESENTED BY THE FAIR MARKET VALUE (AS DEFINED IN THE PLAN) ON THE DATE THE PARTICIPANT EXERCISED ANY OF THE STOCK OPTIONS OVER THE OPTION PRICE, MULTIPLIED BY THE NUMBER OF SHARES THE PARTICIPANT PURCHASED (THE "OPTION GAIN"), SHALL BE PAID BY THE PARTICIPANT TO THE COMPANY WITHIN 30 DAYS OF WRITTEN NOTICE FROM THE COMPANY TO THE PARTICIPANT THAT SUCH PAYMENT IS DUE. THE OPTION GAIN SHALL BE CALCULATED WITHOUT REGARD TO ANY SUBSEQUENT MARKET PRICE DECREASE OR INCREASE. THIS SHALL BE IN ADDITION TO ANY INJUNCTIVE OR OTHER RELIEF TO WHICH THE COMPANY MAY BE ENTITLED UNDER SUBSECTION (f). (f) CONSEQUENCES OF OTHER BREACHES OF THIS SECTION. THE PARTICIPANT ACKNOWLEDGES THAT DAMAGES WHICH MAY ARISE FROM ANY BREACH OF ANY OF HIS/HER PROMISES CONTAINED IN THIS SECTION 10 MAY BE IMPOSSIBLE TO ASCERTAIN OR PROVE WITH CERTAINTY. 5 THE PARTICIPANT AGREES IF THE PARTICIPANT BREACHES ANY OF HIS/HER PROMISES CONTAINED IN THIS SECTION 10, IN ADDITION TO THE REMEDIES PROVIDED UNDER SUBSECTION (e), IF APPLICABLE, AND ANY OTHER LEGAL REMEDIES WHICH MAY BE AVAILABLE, THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES (AS APPLICABLE) SHALL BE ENTITLED TO IMMEDIATE INJUNCTIVE RELIEF FROM A COURT OF COMPETENT JURISDICTION, PENDING ARBITRATION UNDER SECTION 11 OR OTHERWISE, TO END SUCH BREACH, WITHOUT FURTHER PROOF OF DAMAGE. (g) PERMITTED OWNERSHIP. NOTHING IN THIS SECTION 10 SHALL PROHIBIT THE PARTICIPANT FROM OWNING LESS THAN ONE PERCENT (1%) OF ANY COMPANY THAT IS PUBLICLY TRADED ON ANY NATIONAL SECURITIES EXCHANGE. (h) SEVERABILITY AND REASONABLENESS. IF, AT ANY TIME, THE PROVISIONS OF THIS SECTION 10 SHALL BE DETERMINED TO BE INVALID OR UNENFORCEABLE, BY REASON OF BEING VAGUE OR UNREASONABLE AS TO GEOGRAPHIC AREA, DURATION OR SCOPE OF ACTIVITY OR DUE TO ANY OTHER RESTRICTION OR LIMITATION, THIS SECTION 10 SHALL BE CONSIDERED DIVISIBLE AND SHALL BECOME AND BE IMMEDIATELY AMENDED TO ONLY SUCH GEOGRAPHIC AREA, DURATION AND SCOPE OF ACTIVITY AND/OR RESTRICTIONS OR LIMITATIONS AS SHALL BE DETERMINED TO BE REASONABLE AND ENFORCEABLE BY AN ARBITRATOR OR A COURT HAVING JURISDICTION OVER THE MATTER; AND THE PARTICIPANT AGREES THAT THIS SECTION 10 AS SO AMENDED SHALL BE VALID AND BINDING AS THOUGH ANY INVALID OR UNENFORCEABLE PORTION HAD NOT BEEN INCLUDED HEREIN. THE PARTIES AGREE THAT THE GEOGRAPHIC AREA, DURATION AND SCOPE OF THE LIMITATIONS AND THE RESTRICTIONS DESCRIBED IN SUBSECTIONS (a) THROUGH (e) ARE REASONABLE. 11. ARBITRATION OF DISPUTES. Any disputes, claims or controversies between the Participant and the Company, its Subsidiaries or Affiliated Entities which may arise out of or relate to this Option Agreement shall be settled by arbitration. This agreement to arbitrate shall survive the termination of this Option Agreement. Any arbitration shall be in accordance with the Rules of the American Arbitration Association and shall be undertaken pursuant to the Federal Arbitration Act. Arbitration will be held in Dallas, Texas unless the parties mutually agree on another location. The decision of the arbitrator(s) will be enforceable in any court of competent jurisdiction. The arbitrator(s) may, but will not be required, to award such damages or other monetary relief as either party might be entitled to receive from a court of competent jurisdiction. Nothing in this agreement to arbitrate shall preclude the Company from obtaining injunctive relief under Section 10(f) from a court of competent jurisdiction prohibiting any on-going breaches of the Option Agreement by the Participant pending arbitration. The arbitrator(s) may also award costs and attorneys' fees in connection with the arbitration to the prevailing party; however, in the arbitrator's(s') discretion, each party may be ordered to bear its/his/her own costs and attorneys' fees. 12. CHOICE OF LAW. This Option Agreement shall be governed by and construed in accordance with the laws of the State of Texas, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Option Agreement to the substantive law of another jurisdiction, except as superseded by applicable federal law and/or as provided in Section 11 hereof. 6 IN WITNESS WHEREOF, the Company, through a duly authorized officer, and the Participant have executed this Option Agreement as of the day and year first above written. COMPANY: FLEMING COMPANIES, INC., an Oklahoma corporation By ------------------------------------------------ Scott M. Northcutt Executive Vice President - Human Resources PARTICIPANT: ------------------------------------------------ I acknowledge that I received this Option Agreement on ___________________ [INSERT DATE OF RECEIPT] and executed it on ___________________ [INSERT DATE OF EXECUTION]. 7 EX-99.3 7 d97628exv99w3.txt FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT Retail FLEMING COMPANIES, INC. 2002 STOCK INCENTIVE PLAN - -------------------------------------------------------------------------------- NON-QUALIFIED STOCK OPTION AGREEMENT - -------------------------------------------------------------------------------- Name: Grant Date: Option Price: Exercise Date: 25% Shares Granted: 50% Expiration Date: 75% 100% THIS AGREEMENT WILL BE VOID UNLESS FULLY EXECUTED WITHIN TWENTY- ONE (21) DAYS OF RECEIPT BY THE PARTICIPANT. NON-QUALIFIED STOCK OPTION AGREEMENT UNDER THE FLEMING COMPANIES, INC. 2002 STOCK INCENTIVE PLAN THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the "Option Agreement"), made as of this ____ day ______________, _____, at Lewisville, Texas by and between _______________ (hereinafter referred to as the "Participant"), and Fleming Companies, Inc. (hereinafter referred to as the "Company"): WITNESSETH: WHEREAS, the Participant is an "Eligible Associate" of the Company, as such term is defined in the Plan, and it is important to the Company that the Participant be encouraged to remain in the employ of the Company and given incentive to perform while in the employ of the Company; and WHEREAS, as an ancillary part of this Option Agreement, it is also important to the Company to protect its legitimate business interests if the Participant leaves the employ of the Company; and WHEREAS, in recognition of such facts, the Company desires to provide to the Participant an opportunity to purchase shares of the common stock of the Company, as hereinafter provided, pursuant to the "Fleming Companies, Inc. 2002 Stock Incentive Plan" (the "Plan"); and WHEREAS, the Participant is a "Non-Executive Officer Participant" as such term is defined in the Plan, and the Regular Award Committee has made this Award as permitted by Section 3.1 of the Plan. NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for good and valuable consideration, the Participant and the Company hereby agree as follows: 1. GRANT OF STOCK OPTION. The Company hereby grants to the Participant Nonqualified Stock Options (the "Stock Options") to purchase all or any part of an aggregate of _______ shares of Common Stock under and subject to the terms and conditions of this Option Agreement and the Plan, which is incorporated herein by reference and made a part hereof for all purposes. All capitalized terms used in this Option Agreement shall have the same meaning ascribed to them in the Plan unless specifically denoted otherwise. The purchase price per share for each share of Common Stock to be purchased hereunder shall be $__________ (the "Option Price"). 2. TIMES OF EXERCISE OF STOCK OPTION. After, and only after, the conditions of Section 8 hereof have been satisfied, the Participant shall be eligible to exercise that portion of his/her Stock Options pursuant to the schedule set forth hereinafter. If the Participant's employment with the Company (or of any one or more of the Subsidiaries of the Company) remains full-time and continuous at all times prior to any of the "Exercise Dates" set forth in this Section 2, then the Participant shall be entitled, subject to the applicable provisions of the Plan and this Option Agreement having been satisfied, to exercise on or after the applicable Exercise Date, on a cumulative basis, the number of shares of Stock determined by multiplying the aggregate number of shares set forth in Section 1 of this Option Agreement by the designated percentage set forth below. Percent of Stock Exercise Dates Option Exercisable - -------------------------------------------------------------------------------- On or After ______________ 25% On or After ______________ 50% On or After ______________ 75% On or After ______________ 100% 3. TERM OF STOCK OPTION. Except as provided for in Section 4 of this Option Agreement, none of the Stock Options shall be exercisable more than ten years from the Date of Grant (the "Option Period"). 4. SPECIAL RULES WITH RESPECT TO STOCK OPTIONS. With respect to the Stock Options, the following special rules shall apply: (a) Exercise of Exercisable Stock Options on Termination of Employment. Except as provided to the contrary in the Plan or in this Option Agreement, if a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period for any reason other than death or retirement, he/she may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of such termination at any time within three months from the date of termination; provided, however, that if the Participant should die during such three month period, the rights of his/her personal representative shall be as set forth in Section 4(b) of this Option Agreement. (b) Exercise of Exercisable Stock Options on Termination of Employment Due to Death. If a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period due to his/her death, the personal representative of the deceased Participant may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of death within 12 months from the date of death. (c) Exercise of Exercisable Stock Options on Termination of Employment Due to Retirement. If a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated due to retirement in accordance with the Company's retirement policies, the Participant shall have a period of three years following his/her date of retirement to exercise the Stock Options which are otherwise exercisable on his/her date of retirement. (d) Acceleration of Otherwise Unexercisable Stock Options on Termination of Employment. The Committee, in its sole discretion, may determine that upon termination of the employment of a Participant any and all Stock Options shall become automatically fully vested and immediately exercisable by the Participant or his/her personal 2 representative as the case may be for whatever period following such termination as the Committee shall so decide. (e) Acceleration of Options Upon Change of Control. Upon the occurrence of a Change of Control Event, any and all Stock Options will become automatically fully vested and immediately exercisable with such acceleration to occur without the requirement of any further act by either the Company or the Participant. 5. NON-TRANSFERABILITY OF STOCK OPTIONS. Except as provided in Section 9.3 of the Plan regarding certain limited transferability of Stock Options with the Committee's approval, Stock Options shall be transferable only by will or the laws of descent and distribution; however, no such transfer of the Stock Options by the Participant shall be effective to bind the Company unless the Company shall have been furnished with written notice of such transfer and an authenticated copy of the will and/or such other evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee of the terms and conditions of such Option. 6. EMPLOYMENT. So long as the Participant shall continue to be a full-time and continuous employee of the Company or a Subsidiary, the Stock Options shall not be affected by any change of duties or position. Nothing in the Plan or in this Option Agreement shall confer upon the Participant any right to continue in the employ of the Company, any of the Subsidiaries, or any Affiliated Entities or interfere in any way with the right of the Company, any of the Subsidiaries or any Affiliated Entities to terminate such Participant's employment at any time. 7. METHOD OF EXERCISING STOCK OPTION. (a) Procedures for Exercise. The manner of exercising the Stock Options shall be by written notice to the Company at least two days before the date the Stock Option, or part thereof, is to be exercised, and in any event prior to the expiration of the Option Period. Such notice shall state the election to exercise the Stock Options and the number of shares of Common Stock with respect to that portion of the Stock Options being exercised, and shall be signed by the person or persons so exercising the Stock Options. The notice shall be accompanied by payment of the full purchase price of such shares, in which event the Company shall provide a book-entry registration or certificates representing such shares to the person or persons entitled thereto as soon as practicable after the notices have been received. (b) Form of Payment. Payment for shares of Common Stock purchased under this Option Agreement shall be made in full by the Participant in any manner specified in Section 6.2(b) of the Plan. No Common Stock shall be issued to the Participant until the Company receives full payment for the Common Stock purchased under the Stock Options which shall include any required state and federal withholding taxes. Withholding taxes may be paid by the Participant in any manner specified in Section 9.4 of the Plan. (c) Further Information. In the event the Stock Options are exercised, pursuant to the foregoing provisions of this Section 7, by any person or persons other than the Participant in the event of the death of the Participant, the notice of election to exercise shall also be 3 accompanied by appropriate proof of the right of such person or persons to exercise the Stock Options. 8. SECURITIES LAW RESTRICTIONS. Stock Options shall be exercised and Common Stock issued only upon compliance with the Securities Act of 1933, as amended, and any other applicable securities law, or pursuant to an exemption therefrom. 9. NOTICES. All notices or other communications relating to the Plan and this Option Agreement as it relates to the Participant or, in event of the death of the Participant, his/her personal representative shall be in writing and shall be mailed (U.S. Mail) by the Company to the Participant or his/her personal representative, as the case may be, at the then current address as maintained by the Company or such other address as the Participant or his/her personal representative may advise the Company in writing. All other notices shall be given by personal delivery to the Secretary of the Company or by registered or certified mail at his/her principal office or at such other address as the Company may hereafter advise the Participant or his/her personal representative, and it shall be deemed to have been given when they are so personally delivered or when they are deposited in the United States mail in an envelope addressed to the Company, properly stamped for delivery as a registered or certified letter. 10. PROTECTION OF COMPANY'S BUSINESS AS CONSIDERATION. AS SPECIFIC CONSIDERATION TO THE COMPANY FOR THE STOCK OPTIONS, THE PARTICIPANT AGREES: (a) LIMITATIONS ON COMPETITION. SUBJECT TO SUBSECTION (g), THE PARTICIPANT WILL NOT, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, IN ASSOCIATION WITH OR AS A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF ANY OTHER RETAIL CHAIN OR ANY SUBSIDIARY OR AFFILIATE OF ANY SUCH RETAIL CHAIN, ENGAGE IN THE BUSINESS OF THE RETAIL SALE OF FOOD AND RELATED PRODUCTS WITHIN THE STANDARD METROPOLITAN STATISTICAL AREAS (THE "SMSA'S") IN WHICH THE PARTICIPANT IS, AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, EMPLOYED BY THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES, OR IN WHICH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DURING HIS/HER EMPLOYMENT IS, AND/OR ON HIS/HER DATE OF TERMINATION/ SEPARATION WAS, ACTIVELY SOLICITING BUSINESS. (b) CONFIDENTIAL INFORMATION; NO DISPARAGING STATEMENTS. THE PARTICIPANT ACKNOWLEDGES THAT DURING THE COURSE OF THE PARTICIPANT'S EMPLOYMENT WITH THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY, HE/SHE WILL HAVE ACCESS TO AND GAIN KNOWLEDGE OF HIGHLY CONFIDENTIAL AND PROPRIETARY INFORMATION AND TRADE SECRETS. THE PARTICIPANT FURTHER ACKNOWLEDGES THAT THE MISUSE, MISAPPROPRIATION OR DISCLOSURE OF THIS INFORMATION COULD CAUSE IRREPARABLE HARM TO THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY, BOTH DURING AND AFTER THE TERM OF THE PARTICIPANT'S EMPLOYMENT. THEREFORE, THE PARTICIPANT AGREES, DURING HIS/HER EMPLOYMENT AND AT ALL TIMES THEREAFTER, HE/SHE WILL HOLD IN A FIDUCIARY CAPACITY FOR THE BENEFIT OF THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY AND WILL NOT DIVULGE OR DISCLOSE, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON, FIRM OR BUSINESS, ALL CONFIDENTIAL OR PROPRIETARY INFORMATION, KNOWLEDGE AND DATA (INCLUDING, BUT NOT LIMITED TO, PROCESSES, PROGRAMS, TRADE "KNOW HOW," IDEAS, DETAILS OF CONTRACTS, MARKETING PLANS, STRATEGIES, BUSINESS DEVELOPMENT TECHNIQUES, BUSINESS ACQUISITION PLANS, PERSONNEL PLANS, PRICING PRACTICES AND BUSINESS METHODS AND PRACTICES) RELATING IN ANY WAY TO THE BUSINESS OF 4 THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES, CUSTOMERS, SUPPLIERS, JOINT VENTURES, LICENSORS, LICENSEES, DISTRIBUTORS AND OTHER PERSONS AND ENTITIES WITH WHOM THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DO BUSINESS ("CONFIDENTIAL DATA"), EXCEPT UPON THE COMPANY'S WRITTEN CONSENT OR AS REQUIRED BY HIS/HER DUTIES WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES, FOR SO LONG AS SUCH CONFIDENTIAL DATA REMAINS CONFIDENTIAL AND ALL SUCH CONFIDENTIAL DATA, TOGETHER WITH ALL COPIES THEREOF AND NOTES AND OTHER REFERENCES THERETO, SHALL REMAIN THE SOLE PROPERTY OF THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY. THE PARTICIPANT AGREES, DURING HIS/HER EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND AT ALL TIMES THEREAFTER, NOT TO MAKE DISPARAGING STATEMENTS ABOUT THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES OR THEIR OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, PRODUCTS OR SERVICES WHICH HE/SHE KNOWS, OR HAS REASON TO KNOW, ARE FALSE OR MISLEADING. (c) NO SOLICITATION OF EMPLOYEES OR BUSINESS. THE PARTICIPANT AGREES THAT HE/SHE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, RECRUIT, SOLICIT OR INDUCE, OR ATTEMPT TO INDUCE, ANY EMPLOYEES OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES TO TERMINATE THEIR EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND/OR BECOME ASSOCIATED WITH ANOTHER EMPLOYER. THE PARTICIPANT FURTHER AGREES THAT HE/SHE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, SOLICIT, DIVERT OR TAKE AWAY, OR ATTEMPT TO DIVERT OR TAKE AWAY, THE BUSINESS OF ANY OF THE CUSTOMERS OR ACCOUNTS OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES WITHIN THE SMSA'S IN WHICH THE PARTICIPANT IS, AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, EMPLOYED BY THE COMPANY OR ONE OF ITS SUBSIDIARIES OR AFFILIATED ENTITIES, OR IN WHICH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DURING HIS/HER EMPLOYMENT IS, AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, ACTIVELY SOLICITING SUCH BUSINESS. (d) TERM OF THE PARTICIPANT'S PROMISES UNDER THIS SECTION. THE PARTICIPANT AGREES THAT EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (b), HIS/HER PROMISES CONTAINED IN THIS SECTION 10 SHALL CONTINUE IN EFFECT DURING HIS/HER EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND UNTIL THE FIRST ANNIVERSARY OF HIS/HER TERMINATION/SEPARATION. (e) CONSEQUENCES OF BREACH OF LIMITATIONS ON COMPETITION AND/OR OTHER COMPETING EMPLOYMENT. SUBJECT TO SUBSECTION (g), IF AT ANY TIME WITHIN (i) THE TERM OF THIS OPTION AGREEMENT OR (ii) WITHIN ONE (1) YEAR FOLLOWING THE PARTICIPANT'S DATE OF TERMINATION/ SEPARATION, BUT ONLY IF SUCH TERMINATION/SEPARATION OCCURS ON A DATE WHICH IS PRIOR TO TEN (10) YEARS FROM THE DATE OF THIS OPTION AGREEMENT, OR (iii) WITHIN ONE (1) YEAR AFTER HE/SHE EXERCISES ANY PORTION OF THE STOCK OPTIONS, WHICHEVER IS LATEST, THE PARTICIPANT, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, IN ASSOCIATION WITH OR AS A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF ANY OTHER RETAIL CHAIN OR ANY SUBSIDIARY OR AFFILIATE OF ANY SUCH RETAIL CHAIN, ENGAGES IN THE BUSINESS OF THE RETAIL SALE OF FOOD AND RELATED PRODUCTS WITHIN THE SMSA'S IN WHICH THE PARTICIPANT IS, OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, EMPLOYED BY THE COMPANY OR ONE OF ITS SUBSIDIARIES OR AFFILIATED ENTITIES, OR IN WHICH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DURING THE PARTICIPANT'S EMPLOYMENT IS, AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, ACTIVELY SOLICITING BUSINESS, THEN (iv) THE STOCK OPTIONS SHALL TERMINATE EFFECTIVE THE DATE THE PARTICIPANT ENTERS INTO SUCH ACTIVITY (UNLESS TERMINATED SOONER 5 BY OPERATION OF ANOTHER TERM OR CONDITION OF THIS OPTION AGREEMENT OR THE PLAN), AND (v) ANY GAIN REPRESENTED BY THE FAIR MARKET VALUE (AS DEFINED IN THE PLAN) ON THE DATE THE PARTICIPANT EXERCISED ANY OF THE STOCK OPTIONS OVER THE OPTION PRICE, MULTIPLIED BY THE NUMBER OF SHARES THE PARTICIPANT PURCHASED (THE "OPTION GAIN"), SHALL BE PAID BY THE PARTICIPANT TO THE COMPANY WITHIN 30 DAYS OF WRITTEN NOTICE FROM THE COMPANY TO THE PARTICIPANT THAT SUCH PAYMENT IS DUE. THE OPTION GAIN SHALL BE CALCULATED WITHOUT REGARD TO ANY SUBSEQUENT MARKET PRICE DECREASE OR INCREASE. THIS SHALL BE IN ADDITION TO ANY INJUNCTIVE OR OTHER RELIEF TO WHICH THE COMPANY MAY BE ENTITLED UNDER SUBSECTION (f). (f) CONSEQUENCES OF OTHER BREACHES OF THIS SECTION. THE PARTICIPANT ACKNOWLEDGES THAT DAMAGES WHICH MAY ARISE FROM ANY BREACH OF ANY OF HIS/HER PROMISES CONTAINED IN THIS SECTION 10 MAY BE IMPOSSIBLE TO ASCERTAIN OR PROVE WITH CERTAINTY. THE PARTICIPANT AGREES IF THE PARTICIPANT BREACHES ANY OF HIS/HER PROMISES CONTAINED IN THIS SECTION 10, IN ADDITION TO THE REMEDIES PROVIDED UNDER SUBSECTION (e), IF APPLICABLE, AND ANY OTHER LEGAL REMEDIES WHICH MAY BE AVAILABLE, THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES (AS APPLICABLE) SHALL BE ENTITLED TO IMMEDIATE INJUNCTIVE RELIEF FROM A COURT OF COMPETENT JURISDICTION, PENDING ARBITRATION UNDER SECTION 11 OR OTHERWISE, TO END SUCH BREACH, WITHOUT FURTHER PROOF OF DAMAGE. (g) PERMITTED OWNERSHIP. NOTHING IN THIS SECTION 10 SHALL PROHIBIT THE PARTICIPANT FROM OWNING LESS THAN ONE PERCENT (1%) OF ANY COMPANY THAT IS PUBLICLY TRADED ON ANY NATIONAL SECURITIES EXCHANGE. (h) SEVERABILITY AND REASONABLENESS. IF, AT ANY TIME, THE PROVISIONS OF THIS SECTION 10 SHALL BE DETERMINED TO BE INVALID OR UNENFORCEABLE, BY REASON OF BEING VAGUE OR UNREASONABLE AS TO GEOGRAPHIC AREA, DURATION OR SCOPE OF ACTIVITY OR DUE TO ANY OTHER RESTRICTION OR LIMITATION, THIS SECTION 10 SHALL BE CONSIDERED DIVISIBLE AND SHALL BECOME AND BE IMMEDIATELY AMENDED TO ONLY SUCH GEOGRAPHIC AREA, DURATION AND SCOPE OF ACTIVITY AND/OR RESTRICTIONS OR LIMITATIONS AS SHALL BE DETERMINED TO BE REASONABLE AND ENFORCEABLE BY AN ARBITRATOR OR A COURT HAVING JURISDICTION OVER THE MATTER; AND THE PARTICIPANT AGREES THAT THIS SECTION 10 AS SO AMENDED SHALL BE VALID AND BINDING AS THOUGH ANY INVALID OR UNENFORCEABLE PORTION HAD NOT BEEN INCLUDED HEREIN. THE PARTIES AGREE THAT THE GEOGRAPHIC AREA, DURATION AND SCOPE OF THE LIMITATIONS AND THE RESTRICTIONS DESCRIBED IN SUBSECTIONS (a) THROUGH (e) ARE REASONABLE. 11. ARBITRATION OF DISPUTES. Any disputes, claims or controversies between the Participant and the Company, its Subsidiaries or Affiliated Entities which may arise out of or relate to this Option Agreement shall be settled by arbitration. This agreement to arbitrate shall survive the termination of this Option Agreement. Any arbitration shall be in accordance with the Rules of the American Arbitration Association and shall be undertaken pursuant to the Federal Arbitration Act. Arbitration will be held in Dallas, Texas unless the parties mutually agree on another location. The decision of the arbitrator(s) will be enforceable in any court of competent jurisdiction. The arbitrator(s) may, but will not be required, to award such damages or other monetary relief as either party might be entitled to receive from a court of competent jurisdiction. Nothing in this agreement to arbitrate shall preclude the Company from obtaining injunctive relief under Section 10(f) from a court of competent jurisdiction prohibiting any on-going breaches of the Option Agreement by the Participant pending arbitration. The arbitrator(s) may also award costs 6 and attorneys' fees in connection with the arbitration to the prevailing party; however, in the arbitrator's(s') discretion, each party may be ordered to bear its/his/her own costs and attorneys' fees. 12. CHOICE OF LAW. This Option Agreement shall be governed by and construed in accordance with the laws of the State of Texas, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Option Agreement to the substantive law of another jurisdiction, except as superseded by applicable federal law and/or as provided in Section 11 hereof. IN WITNESS WHEREOF, the Company, through a duly authorized officer, and the Participant have executed this Option Agreement as of the day and year first above written. COMPANY: FLEMING COMPANIES, INC., an Oklahoma corporation By ---------------------------------------------- Scott M. Northcutt Executive Vice President - Human Resources PARTICIPANT: ------------------------------------------------ I acknowledge that I received this Option Agreement on ___________________ [INSERT DATE OF RECEIPT] and executed it on ___________________ [INSERT DATE OF EXECUTION]. 7 EX-99.4 8 d97628exv99w4.txt FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT Wholesale FLEMING COMPANIES, INC. 2002 STOCK INCENTIVE PLAN - -------------------------------------------------------------------------------- NON-QUALIFIED STOCK OPTION AGREEMENT - -------------------------------------------------------------------------------- Name: Grant Date: Option Price: Exercise Date: 25% Shares Granted: 50% Expiration Date: 75% 100% THIS AGREEMENT WILL BE VOID UNLESS FULLY EXECUTED WITHIN TWENTY- ONE (21) DAYS OF RECEIPT BY THE PARTICIPANT. NON-QUALIFIED STOCK OPTION AGREEMENT UNDER THE FLEMING COMPANIES, INC. 2002 STOCK INCENTIVE PLAN THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the "Option Agreement"), made as of this ____ day ______________, _____, at Lewisville, Texas by and between _______________ (hereinafter referred to as the "Participant"), and Fleming Companies, Inc. (hereinafter referred to as the "Company"): WITNESSETH: WHEREAS, the Participant is an "Eligible Associate" of the Company, as such term is defined in the Plan, and it is important to the Company that the Participant be encouraged to remain in the employ of the Company and given incentive to perform while in the employ of the Company; and WHEREAS, as an ancillary part of this Option Agreement, it is also important to the Company to protect its legitimate business interests if the Participant leaves the employ of the Company; and WHEREAS, in recognition of such facts, the Company desires to provide to the Participant an opportunity to purchase shares of the common stock of the Company, as hereinafter provided, pursuant to the "Fleming Companies, Inc. 2002 Stock Incentive Plan" (the "Plan"); and WHEREAS, the Participant is a "Non-Executive Officer Participant" as such term is defined in the Plan, and the Regular Award Committee has made this Award as permitted by Section 3.1 of the Plan. NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for good and valuable consideration, the Participant and the Company hereby agree as follows: 1. GRANT OF STOCK OPTION. The Company hereby grants to the Participant Nonqualified Stock Options (the "Stock Options") to purchase all or any part of an aggregate of _______ shares of Common Stock under and subject to the terms and conditions of this Option Agreement and the Plan, which is incorporated herein by reference and made a part hereof for all purposes. All capitalized terms used in this Option Agreement shall have the same meaning ascribed to them in the Plan unless specifically denoted otherwise. The purchase price per share for each share of Common Stock to be purchased hereunder shall be $________ (the "Option Price"). 2. TIMES OF EXERCISE OF STOCK OPTION. After, and only after, the conditions of Section 8 hereof have been satisfied, the Participant shall be eligible to exercise that portion of his/her Stock Options pursuant to the schedule set forth hereinafter. If the Participant's employment with the Company (or of any one or more of the Subsidiaries of the Company) remains full-time and continuous at all times prior to any of the "Exercise Dates" set forth in this Section 2, then the Participant shall be entitled, subject to the applicable provisions of the Plan and this Option Agreement having been satisfied, to exercise on or after the applicable Exercise Date, on a cumulative basis, the number of shares of Stock determined by multiplying the aggregate number of shares set forth in Section 1 of this Option Agreement by the designated percentage set forth below.
Percent of Stock Exercise Dates Option Exercisable - -------------------------------------------------------------------------------- On or After ______________ 25% On or After ______________ 50% On or After ______________ 75% On or After ______________ 100%
3. TERM OF STOCK OPTION. Except as provided for in Section 4 of this Option Agreement, none of the Stock Options shall be exercisable more than ten years from the Date of Grant (the "Option Period"). 4. SPECIAL RULES WITH RESPECT TO STOCK OPTIONS. With respect to the Stock Options, the following special rules shall apply: (a) Exercise of Exercisable Stock Options on Termination of Employment. Except as provided to the contrary in the Plan or in this Option Agreement, if a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period for any reason other than death or retirement, he/she may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of such termination at any time within three months from the date of termination; provided, however, that if the Participant should die during such three month period, the rights of his/her personal representative shall be as set forth in Section 4(b) of this Option Agreement. (b) Exercise of Exercisable Stock Options on Termination of Employment Due to Death. If a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period due to his/her death, the personal representative of the deceased Participant may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of death within 12 months from the date of death. (c) Exercise of Exercisable Stock Options on Termination of Employment Due to Retirement. If a Participant's employment with the Company, a Subsidiary or an Affiliated Entity is terminated due to retirement in accordance with the Company's retirement policies, the Participant shall have a period of three years following his/her date of retirement to exercise the Stock Options which are otherwise exercisable on his/her date of retirement. (d) Acceleration of Otherwise Unexercisable Stock Options on Termination of Employment. The Committee, in its sole discretion, may determine that upon termination of the employment of a Participant any and all Stock Options shall become 2 automatically fully vested and immediately exercisable by the Participant or his/her personal representative as the case may be for whatever period following such termination as the Committee shall so decide. (e) Acceleration of Options Upon Change of Control. Upon the occurrence of a Change of Control Event, any and all Stock Options will become automatically fully vested and immediately exercisable with such acceleration to occur without the requirement of any further act by either the Company or the Participant. 5. NON-TRANSFERABILITY OF STOCK OPTIONS. Except as provided in Section 9.3 of the Plan regarding certain limited transferability of Stock Options with the Committee's approval, Stock Options shall be transferable only by will or the laws of descent and distribution; however, no such transfer of the Stock Options by the Participant shall be effective to bind the Company unless the Company shall have been furnished with written notice of such transfer and an authenticated copy of the will and/or such other evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee of the terms and conditions of such Option. 6. EMPLOYMENT. So long as the Participant shall continue to be a full-time and continuous employee of the Company or a Subsidiary, the Stock Options shall not be affected by any change of duties or position. Nothing in the Plan or in this Option Agreement shall confer upon the Participant any right to continue in the employ of the Company, any of the Subsidiaries, or any Affiliated Entities or interfere in any way with the right of the Company, any of the Subsidiaries or any Affiliated Entities to terminate such Participant's employment at any time. 7. METHOD OF EXERCISING STOCK OPTION. (a) Procedures for Exercise. The manner of exercising the Stock Options shall be by written notice to the Company at least two days before the date the Stock Option, or part thereof, is to be exercised, and in any event prior to the expiration of the Option Period. Such notice shall state the election to exercise the Stock Options and the number of shares of Common Stock with respect to that portion of the Stock Options being exercised, and shall be signed by the person or persons so exercising the Stock Options. The notice shall be accompanied by payment of the full purchase price of such shares, in which event the Company shall provide a book-entry registration or certificates representing such shares to the person or persons entitled thereto as soon as practicable after the notices have been received. (b) Form of Payment. Payment for shares of Common Stock purchased under this Option Agreement shall be made in full by the Participant in any manner specified in Section 6.2(b) of the Plan. No Common Stock shall be issued to the Participant until the Company receives full payment for the Common Stock purchased under the Stock Options which shall include any required state and federal withholding taxes. Withholding taxes may be paid by the Participant in any manner specified in Section 9.4 of the Plan. (c) Further Information. In the event the Stock Options are exercised, pursuant to the foregoing provisions of this Section 7, by any person or persons other than the Participant in the event of the death of the Participant, the notice of election to exercise shall also be 3 accompanied by appropriate proof of the right of such person or persons to exercise the Stock Options. 8. SECURITIES LAW RESTRICTIONS. Stock Options shall be exercised and Common Stock issued only upon compliance with the Securities Act of 1933, as amended, and any other applicable securities law, or pursuant to an exemption therefrom. 9. NOTICES. All notices or other communications relating to the Plan and this Option Agreement as it relates to the Participant or, in event of the death of the Participant, his/her personal representative shall be in writing and shall be mailed (U.S. Mail) by the Company to the Participant or his/her personal representative, as the case may be, at the then current address as maintained by the Company or such other address as the Participant or his/her personal representative may advise the Company in writing. All other notices shall be given by personal delivery to the Secretary of the Company or by registered or certified mail at his/her principal office or at such other address as the Company may hereafter advise the Participant or his/her personal representative, and it shall be deemed to have been given when they are so personally delivered or when they are deposited in the United States mail in an envelope addressed to the Company, properly stamped for delivery as a registered or certified letter. 10. PROTECTION OF COMPANY'S BUSINESS AS CONSIDERATION. AS SPECIFIC CONSIDERATION TO THE COMPANY FOR THE STOCK OPTIONS, THE PARTICIPANT AGREES: (a) LIMITATIONS ON COMPETITION. SUBJECT TO SUBSECTION (g), THE PARTICIPANT WILL NOT, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, IN ASSOCIATION WITH OR AS A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF SUPERVALU, INC., NASH FINCH COMPANY OR ANY OTHER DIRECT COMPETITOR OF THE COMPANY, EXCLUDING NATIONAL RETAIL CHAINS, OR ANY OF THEIR RESPECTIVE SUBSIDIARIES, AFFILIATES OR SUCCESSORS (THE "COMPETITORS"), ENGAGE IN THE BUSINESS OF THE WHOLESALE OF FOOD AND RELATED PRODUCTS WITHIN THE STANDARD METROPOLITAN STATISTICAL AREAS (THE "SMSA'S") IN WHICH THE PARTICIPANT IS, AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, EMPLOYED BY THE COMPANY OR ONE OF ITS SUBSIDIARIES OR AFFILIATED ENTITIES, OR IN WHICH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DURING HIS/HER EMPLOYMENT IS, AND/OR ON HIS/HER DATE OF TERMINATION/ SEPARATION WAS, ACTIVELY SOLICITING BUSINESS. (b) CONFIDENTIAL INFORMATION; NO DISPARAGING STATEMENTS. THE PARTICIPANT ACKNOWLEDGES THAT DURING THE COURSE OF THE PARTICIPANT'S EMPLOYMENT WITH THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY, HE/SHE WILL HAVE ACCESS TO AND GAIN KNOWLEDGE OF HIGHLY CONFIDENTIAL AND PROPRIETARY INFORMATION AND TRADE SECRETS. THE PARTICIPANT FURTHER ACKNOWLEDGES THAT THE MISUSE, MISAPPROPRIATION OR DISCLOSURE OF THIS INFORMATION COULD CAUSE IRREPARABLE HARM TO THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY, BOTH DURING AND AFTER THE TERM OF THE PARTICIPANT'S EMPLOYMENT. THEREFORE, THE PARTICIPANT AGREES, DURING HIS/HER EMPLOYMENT AND AT ALL TIMES THEREAFTER, HE/SHE WILL HOLD IN A FIDUCIARY CAPACITY FOR THE BENEFIT OF THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY AND WILL NOT DIVULGE OR DISCLOSE, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON, FIRM OR BUSINESS, ALL CONFIDENTIAL OR PROPRIETARY INFORMATION, KNOWLEDGE AND DATA (INCLUDING, BUT NOT LIMITED TO, PROCESSES, PROGRAMS, TRADE "KNOW HOW," IDEAS, DETAILS OF CONTRACTS, MARKETING PLANS, STRATEGIES, BUSINESS DEVELOPMENT TECHNIQUES, BUSINESS ACQUISITION PLANS, PERSONNEL PLANS, 4 PRICING PRACTICES AND BUSINESS METHODS AND PRACTICES) RELATING IN ANY WAY TO THE BUSINESS OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES, CUSTOMERS, SUPPLIERS, JOINT VENTURES, LICENSORS, LICENSEES, DISTRIBUTORS AND OTHER PERSONS AND ENTITIES WITH WHOM THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DO BUSINESS ("CONFIDENTIAL DATA"), EXCEPT UPON THE COMPANY'S WRITTEN CONSENT OR AS REQUIRED BY HIS/HER DUTIES WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES, FOR SO LONG AS SUCH CONFIDENTIAL DATA REMAINS CONFIDENTIAL AND ALL SUCH CONFIDENTIAL DATA, TOGETHER WITH ALL COPIES THEREOF AND NOTES AND OTHER REFERENCES THERETO, SHALL REMAIN THE SOLE PROPERTY OF THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY. THE PARTICIPANT AGREES, DURING HIS/HER EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND AT ALL TIMES THEREAFTER, NOT TO MAKE DISPARAGING STATEMENTS ABOUT THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES OR THEIR OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, PRODUCTS OR SERVICES WHICH HE/SHE KNOWS, OR HAS REASON TO KNOW, ARE FALSE OR MISLEADING. (c) NO SOLICITATION OF EMPLOYEES OR BUSINESS. THE PARTICIPANT AGREES THAT HE/SHE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, RECRUIT, SOLICIT OR INDUCE, OR ATTEMPT TO INDUCE, ANY EMPLOYEES OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES TO TERMINATE THEIR EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND/OR BECOME ASSOCIATED WITH ANOTHER EMPLOYER. THE PARTICIPANT FURTHER AGREES THAT HE/SHE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, SOLICIT, DIVERT OR TAKE AWAY, OR ATTEMPT TO DIVERT OR TAKE AWAY, THE BUSINESS OF ANY OF THE CUSTOMERS OR ACCOUNTS OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES WITHIN THE SMSA'S IN WHICH THE PARTICIPANT IS, AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, EMPLOYED BY THE COMPANY, OR ONE OF ITS SUBSIDIARIES OR AFFILIATED ENTITIES, OR IN WHICH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DURING HIS/HER EMPLOYMENT IS, AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, ACTIVELY SOLICITING SUCH BUSINESS. (d) TERM OF THE PARTICIPANT'S PROMISES UNDER THIS SECTION. THE PARTICIPANT AGREES THAT EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (b), HIS/HER PROMISES CONTAINED IN THIS SECTION 10 SHALL CONTINUE IN EFFECT DURING HIS/HER EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND UNTIL THE FIRST ANNIVERSARY OF HIS/HER TERMINATION/SEPARATION. (e) CONSEQUENCES OF BREACH OF LIMITATIONS ON COMPETITION AND/OR OTHER COMPETING EMPLOYMENT. SUBJECT TO SUBSECTION (g), IF AT ANY TIME WITHIN (i) THE TERM OF THIS OPTION AGREEMENT OR (ii) WITHIN ONE (1) YEAR FOLLOWING THE PARTICIPANT'S DATE OF TERMINATION/ SEPARATION, BUT ONLY IF SUCH TERMINATION/SEPARATION OCCURS ON A DATE WHICH IS PRIOR TO TEN (10) YEARS FROM THE DATE OF THIS OPTION AGREEMENT, OR (iii) WITHIN ONE (1) YEAR AFTER HE/SHE EXERCISES ANY PORTION OF THE STOCK OPTIONS, WHICHEVER IS LATEST, THE PARTICIPANT, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, IN ASSOCIATION WITH OR AS A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF THE COMPETITORS, ENGAGES IN THE BUSINESS OF THE WHOLESALE OF FOOD AND RELATED PRODUCTS WITHIN THE SMSA'S IN WHICH THE PARTICIPANT IS, OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, EMPLOYED BY THE COMPANY, OR ONE OF ITS SUBSIDIARIES OR AFFILIATED ENTITIES, OR IN WHICH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DURING THE PARTICIPANT'S EMPLOYMENT IS, AND/OR ON HIS/HER DATE OF TERMINATION/SEPARATION WAS, ACTIVELY SOLICITING BUSINESS, THEN (iv) THE STOCK OPTIONS SHALL TERMINATE EFFECTIVE THE DATE THE PARTICIPANT ENTERS INTO SUCH ACTIVITY 5 (UNLESS TERMINATED SOONER BY OPERATION OF ANOTHER TERM OR CONDITION OF THIS OPTION AGREEMENT OR THE PLAN), AND (v) ANY GAIN REPRESENTED BY THE FAIR MARKET VALUE (AS DEFINED IN THE PLAN) ON THE DATE THE PARTICIPANT EXERCISED ANY OF THE STOCK OPTIONS OVER THE OPTION PRICE, MULTIPLIED BY THE NUMBER OF SHARES THE PARTICIPANT PURCHASED (THE "OPTION GAIN"), SHALL BE PAID BY THE PARTICIPANT TO THE COMPANY WITHIN 30 DAYS OF WRITTEN NOTICE FROM THE COMPANY TO THE PARTICIPANT THAT SUCH PAYMENT IS DUE. THE OPTION GAIN SHALL BE CALCULATED WITHOUT REGARD TO ANY SUBSEQUENT MARKET PRICE DECREASE OR INCREASE. THIS SHALL BE IN ADDITION TO ANY INJUNCTIVE OR OTHER RELIEF TO WHICH THE COMPANY MAY BE ENTITLED UNDER SUBSECTION (f). (f) CONSEQUENCES OF OTHER BREACHES OF THIS SECTION. THE PARTICIPANT ACKNOWLEDGES THAT DAMAGES WHICH MAY ARISE FROM ANY BREACH OF ANY OF HIS/HER PROMISES CONTAINED IN THIS SECTION 10 MAY BE IMPOSSIBLE TO ASCERTAIN OR PROVE WITH CERTAINTY. THE PARTICIPANT AGREES IF THE PARTICIPANT BREACHES ANY OF HIS/HER PROMISES CONTAINED IN THIS SECTION 10, IN ADDITION TO THE REMEDIES PROVIDED UNDER SUBSECTION (e), IF APPLICABLE, AND ANY OTHER LEGAL REMEDIES WHICH MAY BE AVAILABLE, THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES (AS APPLICABLE) SHALL BE ENTITLED TO IMMEDIATE INJUNCTIVE RELIEF FROM A COURT OF COMPETENT JURISDICTION, PENDING ARBITRATION UNDER SECTION 11 OR OTHERWISE, TO END SUCH BREACH, WITHOUT FURTHER PROOF OF DAMAGE. (g) PERMITTED OWNERSHIP. NOTHING IN THIS SECTION 10 SHALL PROHIBIT THE PARTICIPANT FROM OWNING LESS THAN ONE PERCENT (1%) OF ANY COMPANY THAT IS PUBLICLY TRADED ON ANY NATIONAL SECURITIES EXCHANGE. (h) SEVERABILITY AND REASONABLENESS. IF, AT ANY TIME, THE PROVISIONS OF THIS SECTION 10 SHALL BE DETERMINED TO BE INVALID OR UNENFORCEABLE, BY REASON OF BEING VAGUE OR UNREASONABLE AS TO GEOGRAPHIC AREA, DURATION OR SCOPE OF ACTIVITY OR DUE TO ANY OTHER RESTRICTION OR LIMITATION, THIS SECTION 10 SHALL BE CONSIDERED DIVISIBLE AND SHALL BECOME AND BE IMMEDIATELY AMENDED TO ONLY SUCH GEOGRAPHIC AREA, DURATION AND SCOPE OF ACTIVITY AND/OR RESTRICTIONS OR LIMITATIONS AS SHALL BE DETERMINED TO BE REASONABLE AND ENFORCEABLE BY AN ARBITRATOR OR A COURT HAVING JURISDICTION OVER THE MATTER; AND THE PARTICIPANT AGREES THAT THIS SECTION 10 AS SO AMENDED SHALL BE VALID AND BINDING AS THOUGH ANY INVALID OR UNENFORCEABLE PORTION HAD NOT BEEN INCLUDED HEREIN. THE PARTIES AGREE THAT THE GEOGRAPHIC AREA, DURATION AND SCOPE OF THE LIMITATIONS AND THE RESTRICTIONS DESCRIBED IN SUBSECTIONS (a) THROUGH (e) ARE REASONABLE. 11. ARBITRATION OF DISPUTES. Any disputes, claims or controversies between the Participant and the Company, its Subsidiaries or Affiliated Entities which may arise out of or relate to this Option Agreement shall be settled by arbitration. This agreement to arbitrate shall survive the termination of this Option Agreement. Any arbitration shall be in accordance with the Rules of the American Arbitration Association and shall be undertaken pursuant to the Federal Arbitration Act. Arbitration will be held in Dallas, Texas unless the parties mutually agree on another location. The decision of the arbitrator(s) will be enforceable in any court of competent jurisdiction. The arbitrator(s) may, but will not be required, to award such damages or other monetary relief as either party might be entitled to receive from a court of competent jurisdiction. Nothing in this agreement to arbitrate shall preclude the Company from obtaining injunctive relief under Section 10(f) from a court of competent jurisdiction prohibiting any on-going breaches of the Option Agreement by the Participant pending arbitration. The arbitrator(s) may also award costs 6 and attorneys' fees in connection with the arbitration to the prevailing party; however, in the arbitrator's(s') discretion, each party may be ordered to bear its/his/her own costs and attorneys' fees. 12. CHOICE OF LAW. This Option Agreement shall be governed by and construed in accordance with the laws of the State of Texas, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Option Agreement to the substantive law of another jurisdiction, except as superseded by applicable federal law and/or as provided in Section 11 hereof. IN WITNESS WHEREOF, the Company, through a duly authorized officer, and the Participant have executed this Option Agreement as of the day and year first above written. COMPANY: FLEMING COMPANIES, INC., an Oklahoma corporation By -------------------------------------------- Scott M. Northcutt Executive Vice President - Human Resources PARTICIPANT: -------------------------------------------- I acknowledge that I received this Option Agreement on ___________________ [INSERT DATE OF RECEIPT] and executed it on ___________________ [INSERT DATE OF EXECUTION]. 7 EX-99.7 9 d97628exv99w7.txt NON-QUALIFIED STOCK OPTION AGREEMENT NON-QUALIFIED STOCK OPTION AGREEMENT THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the "Option Agreement"), made as of this 30th day of December, 2001, at Lewisville, Texas by and between TIMOTHY R. LABEAU (hereinafter referred to as the "Executive"), and FLEMING COMPANIES, INC. (hereinafter referred to as the "Company"): WITNESSETH: WHEREAS, the Executive has become an associate of the Company in the position of Senior Vice President, Operations, effective as of December 30, 2001, and it is important to the Company that the Executive be encouraged to remain in the employ of the Company and given incentive to perform while in the employ of the Company; and WHEREAS, as an ancillary part of this Option Agreement, it is also important to the Company to protect its legitimate business interests if the Executive leaves the employ of the Company; and WHEREAS, in recognition of such facts and also as a material inducement to his entering into an employment relationship with the Company, the Company desires to provide to the Executive an opportunity to purchase shares of the common stock of the Company. NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for good and valuable consideration, the Executive and the Company hereby agree as follows: 1. ACKNOWLEDGEMENT OF AND RELATIONSHIP TO STOCK INCENTIVE PLAN. (a) The parties to this Option Agreement acknowledge that the Company has previously established the Fleming Companies, Inc. 2000 Stock Incentive Plan (the "Plan"). The award reflected in this Option Agreement is not made, in whole or in part, from the shares of Common Stock authorized to be awarded under the Plan. It is, however, the intent of the parties that, except as otherwise provided in this Option Agreement, terms used herein shall have the same meanings as defined in the Plan. It is also the intent of the parties that, except as otherwise provided herein, this Option Agreement shall be interpreted and administered to provide the Executive and the Company the same respective rights and obligations as if the Stock Options had been awarded under the Plan. (b) The Company may at any time unilaterally and in its sole discretion rescind the award made under this Option Agreement, in whole or in part, and whether or not presently exercisable or vested, and substitute an award under the Plan or under any non-qualified stock option or incentive plan or program that has previously been or may in the future be established; PROVIDED, THAT SUCH RESCISSION AND SUBSTITUTION SHALL NOT CAUSE OR RESULT IN ANY ECONOMIC LOSS OR OTHER ADVERSE CONSEQUENCE TO THE EXECUTIVE ABSENT THE EXECUTIVE'S CONSENT. 2. GRANT OF STOCK OPTION. The Company hereby grants to the Executive Nonqualified Stock Options (the "Stock Options") to purchase all or any part of an aggregate of 100,000 shares of Common Stock under and subject to the terms and conditions of this Option Agreement, to be administered by the Compensation and Organization Committee of the Company's Board of Directors and/or the Regular Award Committee (collectively, the "Committee"). The purchase price per share for each share of Common Stock to be purchased hereunder shall be $19.10 (the "Option Price"). 3. TIMES OF EXERCISE OF STOCK OPTION. After, and only after, the conditions of Section 9 hereof have been satisfied, the Executive shall be eligible to exercise that portion of his Stock Options pursuant to the schedule set forth hereinafter. If the Executive's employment with the Company (or of any one or more of the Subsidiaries or Affiliated Entities of the Company) remains full-time and continuous at all times prior to any of the "Exercise Dates" set forth in this Section 3, then the Executive shall be entitled, subject to the applicable provisions of this Option Agreement having been satisfied, to exercise on or after the applicable Exercise Date, on a cumulative basis, the number of shares of Stock determined by multiplying the aggregate number of shares set forth in Section 2 of this Option Agreement by the designated percentage set forth below.
Percent of Stock Exercise Dates Option Exercisable - ---------------- ------------------ On or After December 30, 2002 25% On or After December 30, 2003 50% On or After December 30, 2004 75% On or After December 30, 2005 100%
4. TERM OF STOCK OPTION. Except as provided for in Section 5 of this Option Agreement, none of the Stock Options shall be exercisable more than ten years from the Date of Grant (the "Option Period"). 5. SPECIAL RULES WITH RESPECT TO STOCK OPTIONS. With respect to the Stock Options, the following special rules shall apply: (a) Exercise of Exercisable Stock Options on Termination of Employment. Except as provided to the contrary in this Option Agreement, if the Executive's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period for any reason other than death, he may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of such termination at any time within three months from the date of termination; provided, however, that if the Executive should die during such three month period, the rights of his personal representative shall be as set forth in Section 5(b) of this Option Agreement. (b) Exercise of Exercisable Stock Options on Termination of Employment Due to Death. If the Executive's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period due to his death, the personal representative of the 2 Executive may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of death within 12 months from the date of death. (c) Acceleration of Otherwise Unexercisable Stock Options on Termination of Employment. The Committee, in its sole discretion, may determine that upon termination of the employment of the Executive any and all Stock Options shall become automatically fully vested and immediately exercisable by the Executive or his personal representative as the case may be for whatever period following such termination as the Committee shall so decide. (d) Acceleration of Options Upon Change of Control. Upon the occurrence of a "Change of Control Event," as defined in that certain Change of Control Employment Agreement made as of December 30, 2001, between the Company and the Executive (the "Change of Control Agreement"), any and all Stock Options will become automatically fully vested and immediately exercisable with such acceleration to occur without the requirement of any further act by either the Company or the Executive. (e) Exercise of Exercisable Stock Options on Termination of Employment Due to Retirement. If the Executive's employment with the Company, a Subsidiary or an Affiliated Entity is terminated due to retirement in accordance with the Company's retirement policies, the Executive shall have a period of three years following his date of retirement to exercise the Stock Options which are otherwise exercisable on his date of retirement. 6. NON-TRANSFERABILITY OF STOCK OPTIONS. Except as provided in Section 9.3 of the Plan regarding certain limited transferability of Stock Options with the Committee's approval, Stock Options shall be transferable only by will or the laws of descent and distribution; however, no such transfer of the Stock Options by the Executive shall be effective to bind the Company unless the Company shall have been furnished with written notice of such transfer and an authenticated copy of the will and/or such other evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee of the terms and conditions of such Option. 7. EMPLOYMENT. So long as the Executive shall continue to be a full-time and continuous associate of the Company or a Subsidiary or Affiliated Entity, the Stock Options shall not be affected by any change of duties or position. Nothing in this Option Agreement shall confer upon the Executive any right to continue in the employ of the Company, any of the Subsidiaries, or any Affiliated Entities or interfere in any way with the right of the Company, any of the Subsidiaries or any Affiliated Entities to terminate the Executive's employment at any time. 8. METHOD OF EXERCISING STOCK OPTION. (a) Procedures for Exercise. The manner of exercising the Stock Options shall be by written notice to the Company at least two days before the date the Stock Option, or part thereof, is to be exercised, and in any event prior to the expiration of the Option Period. Such notice shall state the election to exercise the Stock Options and the number of shares of Common Stock with respect to that portion of the Stock Options being exercised, and shall be signed by the person or persons so exercising the Stock Options. The notice shall be 3 accompanied by payment of the full purchase price of such shares, in which event the Company shall deliver a certificate or certificates representing such shares to the person or persons entitled thereto as soon as practicable after the notices shall be received. (b) Form of Payment. No Common Stock shall be issued to the Executive until the Company receives full payment for the Common Stock purchased under the Stock Options which shall include any required state and federal withholding taxes. Withholding taxes may be paid by the Executive in any manner specified in Section 9.4 of the Plan. (c) Further Information. In the event the Stock Options are exercised, pursuant to the foregoing provisions of this Section 8, by any person or persons other than the Executive in the event of the death of the Executive, the notice of election to exercise shall also be accompanied by appropriate proof of the right of such person or persons to exercise the Stock Options. 9. SECURITIES LAW RESTRICTIONS. The Stock Options shall be exercised and Common Stock issued only upon compliance with the Securities Act of 1933, as amended, and any other applicable securities law, or pursuant to an exemption therefrom. 10. NOTICES. All notices or other communications relating to this Option Agreement as it relates to the Executive or, in event of the death of the Executive, his personal representative shall be in writing and shall be mailed (U.S. Mail) by the Company to the Executive or his personal representative, as the case may be, at the then current address as maintained by the Company or such other address as the Executive or his personal representative may advise the Company in writing. All other notices shall be given by personal delivery to the Secretary of the Company or by registered or certified mail at his principal office or at such other address as the Company may hereafter advise the Executive or his personal representative, and it shall be deemed to have been given when they are so personally delivered or when they are deposited in the United States mail in an envelope addressed to the Company, properly stamped for delivery as a registered or certified letter. 11. PROTECTION OF COMPANY BUSINESS AS CONSIDERATION. AS SPECIFIC CONSIDERATION TO THE COMPANY FOR THE STOCK OPTIONS, THE EXECUTIVE AGREES: (a) LIMITATIONS ON COMPETITION. SUBJECT TO SUBSECTION (g), THE EXECUTIVE WILL NOT, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, BE A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF SUPERVALU, INC., NASH FINCH COMPANY OR ANY OTHER DIRECT COMPETITOR OF THE COMPANY, EXCLUDING NATIONAL RETAIL CHAINS, OR ANY OF THEIR RESPECTIVE SUBSIDIARIES, AFFILIATES OR SUCCESSORS (COLLECTIVELY, THE "COMPETITORS"). (b) CONFIDENTIAL INFORMATION; NO DISPARAGING STATEMENTS. THE EXECUTIVE ACKNOWLEDGES THAT DURING THE COURSE OF HIS EMPLOYMENT WITH THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY, HE WILL HAVE ACCESS TO AND GAIN KNOWLEDGE OF HIGHLY CONFIDENTIAL AND PROPRIETARY INFORMATION AND TRADE SECRETS. THE EXECUTIVE FURTHER ACKNOWLEDGES THAT THE MISUSE, MISAPPROPRIATION OR DISCLOSURE OF THIS INFORMATION COULD CAUSE IRREPARABLE HARM TO THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY, BOTH DURING AND AFTER THE TERM OF THE 4 EXECUTIVE'S EMPLOYMENT. THEREFORE, THE EXECUTIVE AGREES, DURING HIS EMPLOYMENT AND AT ALL TIMES THEREAFTER, HE WILL HOLD IN A FIDUCIARY CAPACITY FOR THE BENEFIT OF THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY AND WILL NOT DIVULGE OR DISCLOSE, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON, FIRM OR BUSINESS, ALL CONFIDENTIAL OR PROPRIETARY INFORMATION, KNOWLEDGE AND DATA (INCLUDING, BUT NOT LIMITED TO, PROCESSES, PROGRAMS, TRADE "KNOW HOW," IDEAS, DETAILS OF CONTRACTS, MARKETING PLANS, STRATEGIES, BUSINESS DEVELOPMENT TECHNIQUES, BUSINESS ACQUISITION PLANS, PERSONNEL PLANS, PRICING PRACTICES AND BUSINESS METHODS AND PRACTICES) RELATING IN ANY WAY TO THE BUSINESS OF THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY, CUSTOMERS, SUPPLIERS, JOINT VENTURES, LICENSORS, LICENSEES, DISTRIBUTORS AND OTHER PERSONS AND ENTITIES WITH WHOM THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DO BUSINESS ("CONFIDENTIAL DATA"), EXCEPT UPON THE COMPANY'S WRITTEN CONSENT OR AS REQUIRED BY HIS DUTIES WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES, FOR SO LONG AS SUCH CONFIDENTIAL DATA REMAINS CONFIDENTIAL AND ALL SUCH CONFIDENTIAL DATA, TOGETHER WITH ALL COPIES THEREOF AND NOTES AND OTHER REFERENCES THERETO, SHALL REMAIN THE SOLE PROPERTY OF THE COMPANY, A SUBSIDIARY OR AN AFFILIATED ENTITY. THE EXECUTIVE AGREES, DURING HIS EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND AT ALL TIMES THEREAFTER, NOT TO MAKE DISPARAGING STATEMENTS ABOUT THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES OR THEIR OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, PRODUCTS OR SERVICES WHICH HE KNOWS, OR HAS REASON TO KNOW, ARE FALSE OR MISLEADING. (c) NO SOLICITATION OF EMPLOYEES OR BUSINESS. THE EXECUTIVE AGREES THAT HE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, RECRUIT, SOLICIT OR INDUCE, OR ATTEMPT TO INDUCE, ANY EMPLOYEES OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES TO TERMINATE THEIR EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND/OR BECOME ASSOCIATED WITH ANOTHER EMPLOYER. THE EXECUTIVE FURTHER AGREES THAT HE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, SOLICIT, DIVERT OR TAKE AWAY, OR ATTEMPT TO DIVERT OR TAKE AWAY, THE BUSINESS OF ANY OF THE CUSTOMERS OR ACCOUNTS OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES WHICH THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY HAD OR WAS ACTIVELY SOLICITING BEFORE AND/OR ON HIS DATE OF TERMINATION/SEPARATION. (d) TERM OF THE EXECUTIVE'S PROMISES UNDER THIS SECTION. THE EXECUTIVE AGREES THAT EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (b), HIS PROMISES CONTAINED IN THIS SECTION 11 SHALL CONTINUE IN EFFECT DURING HIS EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND UNTIL THE FIRST ANNIVERSARY OF HIS TERMINATION/SEPARATION. (e) CONSEQUENCES OF BREACH OF LIMITATIONS ON COMPETITION AND/OR OTHER COMPETING EMPLOYMENT. SUBJECT TO SUBSECTION (g), IF AT ANY TIME WITHIN (i) THE TERM OF THIS OPTION AGREEMENT OR (II) WITHIN ONE (1) YEAR FOLLOWING THE EXECUTIVE'S DATE OF TERMINATION/SEPARATION, BUT ONLY IF SUCH TERMINATION/SEPARATION OCCURS ON A DATE WHICH IS PRIOR TO TEN (10) YEARS FROM THE DATE OF THIS OPTION AGREEMENT, OR (III) WITHIN ONE (1) YEAR AFTER HE EXERCISES ANY PORTION OF THE STOCK OPTIONS, WHICHEVER IS LATEST, THE EXECUTIVE IS, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF ANY OF THE COMPETITORS, THEN (IV) THE STOCK OPTIONS SHALL TERMINATE EFFECTIVE THE DATE THE EXECUTIVE ENTERS INTO SUCH ACTIVITY (UNLESS TERMINATED SOONER BY OPERATION OF ANOTHER TERM OR CONDITION OF THIS OPTION AGREEMENT OR THE PLAN), AND (v) ANY GAIN REPRESENTED BY THE FAIR MARKET VALUE (AS DEFINED 5 IN THE PLAN) ON THE DATE THE EXECUTIVE EXERCISED ANY OF THE STOCK OPTIONS OVER THE OPTION PRICE, MULTIPLIED BY THE NUMBER OF SHARES THE EXECUTIVE PURCHASED (THE "OPTION GAIN"), SHALL BE PAID BY THE EXECUTIVE TO THE COMPANY WITHIN 30 DAYS OF WRITTEN NOTICE FROM THE COMPANY TO THE EXECUTIVE THAT SUCH PAYMENT IS DUE. THE OPTION GAIN SHALL BE CALCULATED WITHOUT REGARD TO ANY SUBSEQUENT MARKET PRICE DECREASE OR INCREASE. THIS SHALL BE IN ADDITION TO ANY INJUNCTIVE OR OTHER RELIEF TO WHICH THE COMPANY MAY BE ENTITLED UNDER SUBSECTION (f). (f) CONSEQUENCES OF OTHER BREACHES OF THIS SECTION. THE EXECUTIVE ACKNOWLEDGES THAT DAMAGES WHICH MAY ARISE FROM ANY BREACH OF ANY OF HIS PROMISES CONTAINED IN THIS SECTION 11 MAY BE IMPOSSIBLE TO ASCERTAIN OR PROVE WITH CERTAINTY. THE EXECUTIVE AGREES IF HE BREACHES ANY OF HIS PROMISES CONTAINED IN THIS SECTION 11, IN ADDITION TO THE REMEDIES PROVIDED UNDER SUBSECTION (e), IF APPLICABLE, AND ANY OTHER LEGAL REMEDIES WHICH MAY BE AVAILABLE, THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES (AS APPLICABLE) SHALL BE ENTITLED TO IMMEDIATE INJUNCTIVE RELIEF FROM A COURT OF COMPETENT JURISDICTION, PENDING ARBITRATION UNDER SECTION 12 OR OTHERWISE, TO END SUCH BREACH, WITHOUT FURTHER PROOF OF DAMAGE. (g) PERMITTED OWNERSHIP. NOTHING IN THIS SECTION 11 SHALL PROHIBIT THE EXECUTIVE FROM OWNING LESS THAN ONE PERCENT (1%) OF ANY COMPANY THAT IS PUBLICLY TRADED ON ANY NATIONAL SECURITIES EXCHANGE. (h) SEVERABILITY AND REASONABLENESS. IF, AT ANY TIME, THE PROVISIONS OF THIS SECTION 11 SHALL BE DETERMINED TO BE INVALID OR UNENFORCEABLE, BY REASON OF BEING VAGUE OR UNREASONABLE AS TO GEOGRAPHIC AREA, DURATION OR SCOPE OF ACTIVITY OR DUE TO ANY OTHER RESTRICTION OR LIMITATION, THIS SECTION 11 SHALL BE CONSIDERED DIVISIBLE AND SHALL BECOME AND BE IMMEDIATELY AMENDED TO ONLY SUCH GEOGRAPHIC AREA, DURATION AND SCOPE OF ACTIVITY AND/OR RESTRICTIONS OR LIMITATIONS AS SHALL BE DETERMINED TO BE REASONABLE AND ENFORCEABLE BY AN ARBITRATOR OR A COURT HAVING JURISDICTION OVER THE MATTER; AND THE EXECUTIVE AGREES THAT THIS SECTION 11 AS SO AMENDED SHALL BE VALID AND BINDING AS THOUGH ANY INVALID OR UNENFORCEABLE PORTION HAD NOT BEEN INCLUDED HEREIN. THE PARTIES AGREE THAT THE GEOGRAPHIC AREA, DURATION AND SCOPE OF THE LIMITATIONS AND THE RESTRICTIONS DESCRIBED IN SUBSECTIONS (a) THROUGH (e) ARE REASONABLE. 12. ARBITRATION OF DISPUTES. Any disputes, claims or controversies between the Executive and the Company, its Subsidiaries or Affiliated Entities which may arise out of or relate to this Option Agreement shall be settled by arbitration. This agreement to arbitrate shall survive the termination of this Option Agreement. Any arbitration shall be in accordance with the Rules of the American Arbitration Association and shall be undertaken pursuant to the Federal Arbitration Act. Arbitration will be held in Dallas, Texas unless the parties mutually agree on another location. The decision of the arbitrator(s) will be enforceable in any court of competent jurisdiction. The arbitrator(s) may, but will not be required, to award such damages or other monetary relief as either party might be entitled to receive from a court of competent jurisdiction. Nothing in this agreement to arbitrate shall preclude the Company from obtaining injunctive relief under Section 11(f) from a court of competent jurisdiction prohibiting any on-going breaches of the Option Agreement by the Executive pending arbitration. The arbitrator(s) may also award costs and attorneys' fees in connection with the arbitration to the 6 prevailing party; however, in the arbitrator's(s') discretion, each party may be ordered to bear its/his own costs and attorneys' fees. 13. CHOICE OF LAW. This Option Agreement shall be governed by and construed in accordance with the laws of the State of Texas, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Option Agreement to the substantive law of another jurisdiction, except as superseded by applicable federal law and/or as provided in Section 12 hereof. 14. COPY OF PLAN ATTACHED. A copy of the Plan is attached as Exhibit "A," but is incorporated herein only to the extent provided in Section 1 above. IN WITNESS WHEREOF, the Company, through a duly authorized officer, and the Executive have executed this Option Agreement as of the day and year first above written. COMPANY: FLEMING COMPANIES, INC., an Oklahoma corporation By /s/ SCOTT M. NORTHCUTT ---------------------------------------------- Scott M. Northcutt Executive Vice President - Human Resources EXECUTIVE: /s/ TIMOTHY R. LABEAU ------------------------------------------------ Timothy R. LaBeau I acknowledge that I received this Option Agreement on ___________________ [INSERT DATE OF RECEIPT] and executed it on ___________________ [INSERT DATE OF EXECUTION]. 7 EX-99.8 10 d97628exv99w8.txt NON-QUALIFIED STOCK OPTION AGREEMENT NON-QUALIFIED STOCK OPTION AGREEMENT THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the "Option Agreement"), made as of this 18th day of December, 2001, by and between J. R. CAMPBELL (hereinafter referred to as the "Executive"), and FLEMING COMPANIES, INC. (hereinafter referred to as the "Company"): WITNESSETH: WHEREAS, the Company has offered the Executive employment as Executive Vice President, Merchandising and Supply, and the Executive has accepted such employment; and WHEREAS, it is important to the Company that the Executive be encouraged to remain in the employ of the Company and given an incentive to perform while in the employ of the Company; and WHEREAS, in recognition of such facts and as a material inducement for Executive to accept and continue his employment with the Company, the Compensation and Organization Committee of the Board of Directors of the Company (the "Committee") has awarded the Executive nonqualified stock options to purchase 200,000 shares of common stock subject to the terms and conditions of this Option Agreement; and WHEREAS, as an ancillary part of this Option Agreement, it is also important to the Company to protect its legitimate business interests if the Executive leaves the employ of the Company. NOW, THEREFORE, in consideration of the premises and the mutual promises and covenants herein contained, the Executive and the Company agree as follows: 1. OPERATION OF THE OPTION AGREEMENT AND RELATIONSHIP TO THE PLAN. The Company has previously adopted the Fleming Companies, Inc. 2000 Stock Incentive Plan (the "Plan"), a copy of which is attached hereto as Exhibit A. It is the intent of the parties that, except as provided herein, capitalized terms used in this Option Agreement shall have the same meanings as defined in the Plan. 2. GRANT OF STOCK OPTION. The Company hereby grants to the Executive Nonqualified Stock Options (the "Stock Options") to purchase all or any part of an aggregate of 200,000 shares of Common Stock under and subject to the terms and conditions of this Option Agreement. The purchase price per share for each share of Common Stock to be purchased hereunder shall be $20.1550 (the "Option Price"). 3. TIMES OF EXERCISE OF STOCK OPTION. After, and only after, the conditions of Section 9 hereof have been satisfied, the Executive shall be eligible to exercise that portion of his Stock Options pursuant to the schedule set forth hereinafter. If the Executive's employment with the Company (or of any one or more of the Subsidiaries of the Company) remains full-time and continuous at all times prior to any of the "Exercise Dates" set forth in this Section 3, then the Executive shall be entitled, subject to this Option Agreement having been satisfied, to exercise on or after the applicable Exercise Date, on a cumulative basis, the number of shares of Stock determined by multiplying the aggregate number of shares set forth in Section 2 of this Option Agreement by the designated percentage set forth below. Percent of Stock Exercise Dates Option Exercisable - -------------------------------------------------------------------------------- On or After December 18, 2002 50% On or After December 18, 2003 100% 4. TERM OF STOCK OPTION. Except as provided for in Section 5 of this Option Agreement, none of the Stock Options shall be exercisable more than ten years from the Date of Grant (the "Option Period"). 5. SPECIAL RULES WITH RESPECT TO STOCK OPTIONS. With respect to the Stock Options, the following special rules shall apply: (a) Exercise of Exercisable Stock Options on Termination of Employment. Except as provided to the contrary in this Option Agreement, if the Executive's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period for any reason other than death, he may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of such termination at any time within three months from the date of termination; provided, however, that if the Executive should die during such three month period, the rights of his personal representative shall be as set forth in Section 5(b) of this Option Agreement. (b) Exercise of Exercisable Stock Options on Termination of Employment Due to Death. If the Executive's employment with the Company, a Subsidiary or an Affiliated Entity is terminated during the Option Period due to his death, the personal representative of the deceased Executive may exercise all or any portion of the Stock Options which are otherwise exercisable on the date of death within 12 months from the date of death. (c) Acceleration of Otherwise Unexercisable Stock Options on Termination of Employment. The Committee, in its sole discretion, may determine that upon termination of the employment of Executive any and all Stock Options shall become automatically fully vested and immediately exercisable by the Executive or his personal representative as the case may be for whatever period following such termination as the Committee shall so decide. (d) Acceleration of Options Upon Change of Control. Upon the occurrence of a Change of Control Event, any and all Stock Options will become automatically fully vested and immediately exercisable with such acceleration to occur without the requirement of any further act by either the Company or the Executive. (e) Exercise of Exercisable Stock Options on Termination of Employment Due to Retirement. If the Executive's employment with the Company, a Subsidiary or an Affiliated Entity is terminated due to retirement in accordance with the Company's retirement policies, the Executive shall have a period of three years following his date of retirement to exercise the Stock Options which are otherwise exercisable on his/her date of retirement. 2 6. NON-TRANSFERABILITY OF STOCK OPTIONS. With the Committee's approval, the Stock Options shall be transferable in the limited same manner and under the same limited circumstances as described in Section 9.3 of the Plan regarding the limited transferability of stock options awarded under the Plan. Otherwise, the Stock Options shall be transferable only by will or the laws of descent and distribution; however, no such transfer of the Stock Options by the Executive shall be effective to bind the Company unless the Company shall have been furnished with written notice of such transfer and an authenticated copy of the will and/or such other evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee of the terms and conditions of such Stock Option. 7. EMPLOYMENT. So long as the Executive shall continue to be a full-time and continuous employee of the Company or a Subsidiary, the Stock Options shall not be affected by any change of duties or position. Nothing in this Option Agreement shall confer upon the Executive any right to continue in the employ of the Company, any of the Subsidiaries, or any Affiliated Entities or interfere in any way with the right of the Company, any of the Subsidiaries or any Affiliated Entities to terminate the Executive's employment at any time. 8. METHOD OF EXERCISING STOCK OPTION. (a) Procedures for Exercise. The manner of exercising the Stock Options shall be by written notice to the Company at least two days before the date the Stock Option, or part thereof, is to be exercised, and in any event prior to the expiration of the Option Period. Such notice shall state the election to exercise the Stock Options and the number of shares of Common Stock with respect to that portion of the Stock Options being exercised, and shall be signed by the person or persons so exercising the Stock Options. The notice shall be accompanied by payment of the full purchase price of such shares, in which event the Company shall deliver a certificate or certificates representing such shares to the person or persons entitled thereto as soon as practicable after the notices shall be received. (b) Form of Payment. Payment for shares of Common Stock purchased under this Option Agreement shall be made in full by the Executive in any manner specified in Section 6.2(b) of the Plan for payment for shares of Common Stock pursuant to stock options awarded under the Plan. No Common Stock shall be issued to the Executive until the Company receives full payment for the Common Stock purchased under the Stock Options which shall include any required state and federal withholding taxes. Withholding taxes may be paid by the Executive in any manner specified in Section 9.4 of the Plan for withholding taxes to be paid in connection with shares of Common Stock purchased under stock options awarded under the Plan. (c) Further Information. In the event the Stock Options are exercised, pursuant to the foregoing provisions of this Section 8, by any person or persons other than the Executive in the event of the death of the Executive, the notice of election to exercise shall also be accompanied by appropriate proof of the right of such person or persons to exercise the Stock Options. 9. SECURITIES LAW RESTRICTIONS. Stock Options shall be exercised and Common Stock issued only upon compliance with the Securities Act of 1933, as amended, and any other applicable securities law, or pursuant to an exemption therefrom. 3 10. NOTICES. All notices or other communications relating to this Option Agreement or, in event of the death of the Executive, his personal representative, shall be in writing and shall be mailed (U.S. Mail) by the Company to the Executive or his personal representative, as the case may be, at the then current address as maintained by the Company or such other address as the Executive or his personal representative may advise the Company in writing. All other notices shall be given by personal delivery to the Secretary of the Company or by registered or certified mail at his principal office or at such other address as the Company may hereafter advise the Executive or his personal representative, and it shall be deemed to have been given when they are so personally delivered or when they are deposited in the United States mail in an envelope addressed to the Company, properly stamped for delivery as a registered or certified letter. 11. PROTECTION OF COMPANY BUSINESS AS CONSIDERATION. AS SPECIFIC CONSIDERATION TO THE COMPANY FOR THE STOCK OPTIONS, THE EXECUTIVE AGREES: (a) LIMITATIONS ON COMPETITION. SUBJECT TO SUBSECTION (g), THE EXECUTIVE WILL NOT, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, BE A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF SUPERVALU, INC., NASH FINCH COMPANY OR ANY OTHER DIRECT COMPETITOR OF THE COMPANY, EXCLUDING NATIONAL RETAIL CHAINS, OR ANY OF THEIR RESPECTIVE SUBSIDIARIES, AFFILIATES OR SUCCESSORS (COLLECTIVELY, THE "COMPETITORS"). (b) CONFIDENTIAL INFORMATION; NO DISPARAGING STATEMENTS. THE EXECUTIVE ACKNOWLEDGES THAT DURING THE COURSE OF THE EXECUTIVE'S EMPLOYMENT WITH THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY, HE WILL HAVE ACCESS TO AND GAIN KNOWLEDGE OF HIGHLY CONFIDENTIAL AND PROPRIETARY INFORMATION AND TRADE SECRETS. THE EXECUTIVE FURTHER ACKNOWLEDGES THAT THE MISUSE, MISAPPROPRIATION OR DISCLOSURE OF THIS INFORMATION COULD CAUSE IRREPARABLE HARM TO THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY, BOTH DURING AND AFTER THE TERM OF THE EXECUTIVE'S EMPLOYMENT. THEREFORE, THE EXECUTIVE AGREES, DURING HIS EMPLOYMENT AND AT ALL TIMES THEREAFTER, HE WILL HOLD IN A FIDUCIARY CAPACITY FOR THE BENEFIT OF THE COMPANY, A SUBSIDIARY AND/OR AFFILIATED ENTITY AND WILL NOT DIVULGE OR DISCLOSE, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON, FIRM OR BUSINESS, ALL CONFIDENTIAL OR PROPRIETARY INFORMATION, KNOWLEDGE AND DATA (INCLUDING, BUT NOT LIMITED TO, PROCESSES, PROGRAMS, TRADE "KNOW HOW," IDEAS, DETAILS OF CONTRACTS, MARKETING PLANS, STRATEGIES, BUSINESS DEVELOPMENT TECHNIQUES, BUSINESS ACQUISITION PLANS, PERSONNEL PLANS, PRICING PRACTICES AND BUSINESS METHODS AND PRACTICES) RELATING IN ANY WAY TO THE BUSINESS OF THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY, CUSTOMERS, SUPPLIERS, JOINT VENTURES, LICENSORS, LICENSEES, DISTRIBUTORS AND OTHER PERSONS AND ENTITIES WITH WHOM THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES DO BUSINESS ("CONFIDENTIAL DATA"), EXCEPT UPON THE COMPANY'S WRITTEN CONSENT OR AS REQUIRED BY HIS DUTIES WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES, FOR SO LONG AS SUCH CONFIDENTIAL DATA REMAINS CONFIDENTIAL AND ALL SUCH CONFIDENTIAL DATA, TOGETHER WITH ALL COPIES THEREOF AND NOTES AND OTHER REFERENCES THERETO, SHALL REMAIN THE SOLE PROPERTY OF THE COMPANY, A SUBSIDIARY OR AN AFFILIATED ENTITY. THE EXECUTIVE AGREES, DURING HIS EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND AT ALL TIMES THEREAFTER, NOT TO MAKE DISPARAGING STATEMENTS ABOUT THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES OR THEIR OFFICERS, DIRECTORS, AGENTS, 4 EMPLOYEES, PRODUCTS OR SERVICES WHICH HE KNOWS, OR HAS REASON TO KNOW, ARE FALSE OR MISLEADING. (c) NO SOLICITATION OF EMPLOYEES OR BUSINESS. THE EXECUTIVE AGREES THAT HE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, RECRUIT, SOLICIT OR INDUCE, OR ATTEMPT TO INDUCE, ANY EMPLOYEES OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES TO TERMINATE THEIR EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND/OR BECOME ASSOCIATED WITH ANOTHER EMPLOYER. THE EXECUTIVE FURTHER AGREES THAT HE WILL NOT, EITHER DIRECTLY OR IN CONCERT WITH OTHERS, SOLICIT, DIVERT OR TAKE AWAY, OR ATTEMPT TO DIVERT OR TAKE AWAY, THE BUSINESS OF ANY OF THE CUSTOMERS OR ACCOUNTS OF THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES WHICH THE COMPANY, A SUBSIDIARY OR AFFILIATED ENTITY HAD OR WAS ACTIVELY SOLICITING BEFORE AND/OR ON HIS DATE OF TERMINATION/SEPARATION. (d) TERM OF THE EXECUTIVE'S PROMISES UNDER THIS SECTION. THE EXECUTIVE AGREES THAT EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (b), HIS PROMISES CONTAINED IN THIS SECTION 11 SHALL CONTINUE IN EFFECT DURING HIS EMPLOYMENT WITH THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES AND UNTIL THE FIRST ANNIVERSARY OF HIS TERMINATION/SEPARATION. (e) CONSEQUENCES OF BREACH OF LIMITATIONS ON COMPETITION AND/OR OTHER COMPETING EMPLOYMENT. SUBJECT TO SUBSECTION (g), IF AT ANY TIME WITHIN (i) THE TERM OF THIS OPTION AGREEMENT OR (ii) WITHIN ONE (1) YEAR FOLLOWING THE EXECUTIVE'S DATE OF TERMINATION/SEPARATION, BUT ONLY IF SUCH TERMINATION/SEPARATION OCCURS ON A DATE WHICH IS PRIOR TO TEN (10) YEARS FROM THE DATE OF THIS OPTION AGREEMENT, OR (iii) WITHIN ONE (1) YEAR AFTER HE EXERCISES ANY PORTION OF THE STOCK OPTIONS, WHICHEVER IS LATEST, THE EXECUTIVE IS, WITHOUT THE COMPANY'S WRITTEN CONSENT, DIRECTLY OR INDIRECTLY, A SHAREHOLDER, PRINCIPAL, AGENT, PARTNER, OFFICER, DIRECTOR, EMPLOYEE OR CONSULTANT OF ANY OF THE COMPETITORS, THEN (iv) THE STOCK OPTIONS SHALL TERMINATE EFFECTIVE THE DATE THE EXECUTIVE ENTERS INTO SUCH ACTIVITY (UNLESS TERMINATED SOONER BY OPERATION OF ANOTHER TERM OR CONDITION OF THIS OPTION AGREEMENT OR THE PLAN), AND (v) ANY GAIN REPRESENTED BY THE FAIR MARKET VALUE (AS DEFINED IN THE PLAN) ON THE DATE THE EXECUTIVE EXERCISED ANY OF THE STOCK OPTIONS OVER THE OPTION PRICE, MULTIPLIED BY THE NUMBER OF SHARES THE EXECUTIVE PURCHASED (THE "OPTION GAIN"), SHALL BE PAID BY THE EXECUTIVE TO THE COMPANY WITHIN 30 DAYS OF WRITTEN NOTICE FROM THE COMPANY TO THE EXECUTIVE THAT SUCH PAYMENT IS DUE. THE OPTION GAIN SHALL BE CALCULATED WITHOUT REGARD TO ANY SUBSEQUENT MARKET PRICE DECREASE OR INCREASE. THIS SHALL BE IN ADDITION TO ANY INJUNCTIVE OR OTHER RELIEF TO WHICH THE COMPANY MAY BE ENTITLED UNDER SUBSECTION (f). (f) CONSEQUENCES OF OTHER BREACHES OF THIS SECTION. THE EXECUTIVE ACKNOWLEDGES THAT DAMAGES WHICH MAY ARISE FROM ANY BREACH OF ANY OF HIS PROMISES CONTAINED IN THIS SECTION 11 MAY BE IMPOSSIBLE TO ASCERTAIN OR PROVE WITH CERTAINTY. THE EXECUTIVE AGREES IF THE EXECUTIVE BREACHES ANY OF HIS PROMISES CONTAINED IN THIS SECTION 11, IN ADDITION TO THE REMEDIES PROVIDED UNDER SUBSECTION (e), IF APPLICABLE, AND ANY OTHER LEGAL REMEDIES WHICH MAY BE AVAILABLE, THE COMPANY, ITS SUBSIDIARIES OR AFFILIATED ENTITIES (AS APPLICABLE) SHALL BE ENTITLED TO IMMEDIATE INJUNCTIVE RELIEF FROM A COURT OF COMPETENT JURISDICTION, PENDING ARBITRATION UNDER SECTION 12 OR OTHERWISE, TO END SUCH BREACH, WITHOUT FURTHER PROOF OF DAMAGE. 5 (g) PERMITTED OWNERSHIP. NOTHING IN THIS SECTION 11 SHALL PROHIBIT THE EXECUTIVE FROM OWNING LESS THAN ONE PERCENT (1%) OF ANY COMPANY THAT IS PUBLICLY TRADED ON ANY NATIONAL SECURITIES EXCHANGE. (h) SEVERABILITY AND REASONABLENESS. IF, AT ANY TIME, THE PROVISIONS OF THIS SECTION 11 SHALL BE DETERMINED TO BE INVALID OR UNENFORCEABLE, BY REASON OF BEING VAGUE OR UNREASONABLE AS TO GEOGRAPHIC AREA, DURATION OR SCOPE OF ACTIVITY OR DUE TO ANY OTHER RESTRICTION OR LIMITATION, THIS SECTION 11 SHALL BE CONSIDERED DIVISIBLE AND SHALL BECOME AND BE IMMEDIATELY AMENDED TO ONLY SUCH GEOGRAPHIC AREA, DURATION AND SCOPE OF ACTIVITY AND/OR RESTRICTIONS OR LIMITATIONS AS SHALL BE DETERMINED TO BE REASONABLE AND ENFORCEABLE BY AN ARBITRATOR OR A COURT HAVING JURISDICTION OVER THE MATTER; AND THE EXECUTIVE AGREES THAT THIS SECTION 11 AS SO AMENDED SHALL BE VALID AND BINDING AS THOUGH ANY INVALID OR UNENFORCEABLE PORTION HAD NOT BEEN INCLUDED HEREIN. THE PARTIES AGREE THAT THE GEOGRAPHIC AREA, DURATION AND SCOPE OF THE LIMITATIONS AND THE RESTRICTIONS DESCRIBED IN SUBSECTIONS (a) THROUGH (e) ARE REASONABLE. 12. ARBITRATION OF DISPUTES. Any disputes, claims or controversies between the Executive and the Company, its Subsidiaries or Affiliated Entities which may arise out of or relate to this Option Agreement shall be settled by arbitration. This agreement to arbitrate shall survive the termination of this Option Agreement. Any arbitration shall be in accordance with the Rules of the American Arbitration Association and shall be undertaken pursuant to the Federal Arbitration Act. Arbitration will be held in Dallas, Texas unless the parties mutually agree on another location. The decision of the arbitrator(s) will be enforceable in any court of competent jurisdiction. The arbitrator(s) may, but will not be required, to award such damages or other monetary relief as either party might be entitled to receive from a court of competent jurisdiction. Nothing in this agreement to arbitrate shall preclude the Company from obtaining injunctive relief under Section 11(f) from a court of competent jurisdiction prohibiting any on-going breaches of the Option Agreement by the Executive pending arbitration. The arbitrator(s) may also award costs and attorneys' fees in connection with the arbitration to the prevailing party; however, in the arbitrator's(s') discretion, each party may be ordered to bear its/his own costs and attorneys' fees. 13. CHOICE OF LAW. This Option Agreement shall be governed by and construed in accordance with the laws of the State of Texas, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Option Agreement to the substantive law of another jurisdiction, except as superseded by applicable federal law and/or as provided in Section 12 hereof. 14. OPTION AGREEMENT REPLACES PLAN OPTION AGREEMENT. The parties agree that this Option Agreement replaces and supersedes the Nonqualified Stock Option Agreement Under the Fleming Companies, Inc. 2000 Stock Option Plan between them, dated as of December 18, 2001 (the "Plan Option Agreement"). The parties acknowledge that the Plan Option Agreement contains terms which are contrary to the Plan and is therefore null and void and mutually wish to substitute this Option Agreement for the Plan Option Agreement. 6 IN WITNESS WHEREOF, the Company, through a duly authorized officer, and the Executive have executed this Option Agreement as of the day and year first above written. COMPANY: FLEMING COMPANIES, INC., an Oklahoma corporation By /s/ SCOTT M. NORTHCUTT --------------------------------------------- Scott M. Northcutt Executive Vice President - Human Resources EXECUTIVE: /s/ J. R. CAMPBELL --------------------------------------------- J. R. Campbell I acknowledge that I received this Option Agreement on ___________________ [INSERT DATE OF RECEIPT] and executed it on ___________________ [INSERT DATE OF EXECUTION]. 7 -----END PRIVACY-ENHANCED MESSAGE-----