EXHIBIT
10.58
MOTHER'S CAKE & COOKIE CO.
SECOND AMENDED AND RESTATED
SUPPLEMENTAL
LONG TERM INCENTIVE PLAN
FOR KEY EMPLOYEES
MOTHER'S CAKE & COOKIE CO.
SECOND AMENDED AND RESTATED
SUPPLEMENTAL LONG TERM INCENTIVE PLAN
FOR KEY EMPLOYEES
Section 1. Purpose. The purpose of the Mother's
Cake & Cookie Co. Supplemental Long Term Incentive Plan for
Key Employees is to promote the interests of Mother's Cake &
Cookie Co. and Specialty Foods Corporation, its parent
corporation, by attracting, incenting and rewarding certain
key executives of Mother's Cake & Cookie Co. to: (a) create
economic value; (b) focus management's attention on overall
corporate performance and thereby promote cooperation and
teamwork among management; and (c) provide executives with a
direct economic interest in the attainment of long term
business objectives. This Plan supersedes the Mother's Cake
& Cookie Co. Supplemental Long Term Incentive Plan effective
October 31, 1997 and the Amended and Restated Supplemental
Long Term Incentive Plan effective March 15, 1999. All
Participant Awards previously granted under the First
Amended and Restated Plan effective March 15, 1999 remain in
full force and effect (unless otherwise previously
terminated pursuant to the terms of the first Amended and
Restated Plan) and are to be deemed granted under the terms
of this Second Amendment.
Section 2. Definitions. As used in this Plan,
capitalized terms shall have the meanings set forth below:
(a) "Board of Directors" shall mean the board of
directors of SFC, as in place from time to time.
(b) "Change of Control" shall mean a sale or
transfer, directly or indirectly, of all of the outstanding
stock of Holdings or the Company or substantially all of the
assets of Holdings or the Company to an unaffiliated entity.
(c) "Change of Control Payment" shall mean a
payment to be made to a Participant in accordance with
Section 4(a).
(d) "Company" shall mean Mother's Cake & Cookie
Co., a California corporation and its subsidiaries,
including Archway Cookies, L.L.C., a Delaware limited
liability corporation.
(e) "Effective Date" shall mean March 15, 2000.
(f) "EBITDA" shall mean the amount determined on
a consolidated basis for Holdings and the Company (as
reflected on the consolidated financial statements of
Holdings and the Company) for the Measuring Fiscal Year
equal to the consolidated (i) income from operations, plus
(ii) depreciation of its property, plant and equipment and
amortization of intangible assets of Holdings and the
Company.
(g) "Employee" shall mean an employee of the
Company.
(h) "Fair Market Value" shall mean:
(i) In the event of a
potential Change of Control
Payment, the aggregate net cash
proceeds received by Holdings, the
Company and/or SFC (and its
subsidiaries) (after deducting all
transaction fees and expenses
incurred by Holdings, the Company
and/or SFC in connection with such
Change of Control); and
(ii) In the event of a
potential Terminal Value Payment,
the Fair Market Value of Holdings
and the Company, as of the Terminal
Value Measurement Date, as
determined by multiplying the
EBITDA of the Measuring Fiscal Year
by a factor of nine and a half
(9.5). By way of example, if the
EBITDA of the Measuring Fiscal Year
equaled $25.0 million, the Fair
Market Value would equal $237.5
million.
(i) "Fiscal Year" shall mean the calendar year
ending December 31, whether or not such period is the fiscal
year end of Holdings and the Company.
(j) "Holdings" shall mean MCC-DSD Holdings, Inc.,
a Delaware corporation and the parent corporation of the
Company.
(k) "Measuring Fiscal Year" shall mean the Fiscal
Year of Holdings and the Company ending December, 2000.
(l) "Participant" shall mean an Employee
designated by the Board of Directors to participate in the
Plan.
(m) "Participant Award" shall mean an award
granted by the Board of Directors to a Participant pursuant
to Section 3 of a specified Value Increase Participation
Rate, as evidenced by the issuance of a Participant Award
Agreement by the Company in favor of the Participant.
(n) "Participant Award Agreement" shall mean an
agreement in the form of Exhibit A.
(o) "Plan" shall mean the Mother's Cake & Cookie
Co. Supplemental Long Term Incentive Plan, as may be amended
from time to time.
(p) "SFC" shall mean Specialty Foods Corporation,
the parent corporation of Holdings and the Company.
(q) "Terminal Value Measuring Date" shall mean
December 31, 2000.
(r) "Terminal Value Payment" shall mean a payment
to be made to a Participant in accordance with Section 4(b).
(s) "Threshold Value" shall mean an amount equal
to $216 million.
(t) "Value Increase Participation Rate" shall
mean, with respect to any Participant, the percentage of the
Value Increase Amount granted to such Participant pursuant
to his or her Participant Award.
(u) "Value Increase Amount" shall mean:
(i) In determining the
amount of a Change of Control
Payment, an amount equal to the
Fair Market Value as determined in
connection with such Change of
Control minus the Threshold Value;
or
(ii) In determining the
amount of a Terminal Value Payment,
an amount equal to the Fair Market
Value as determined at the Terminal
Value Measurement Date minus the
Threshold Value.
Section 3. Eligibility. Participants in the Plan
shall be designated by the Board of Directors (provided that
such Authority may be designated to SFC and by SFC to the
Company) and shall consist of those Employees (whether or
not employed on the Effective Date) who, in the sole
discretion of the Board of Directors, have the potential to
make a significant impact on the financial results of
Holdings and the Company. The Board of Directors'
designation of an Employee as a Participant and the grant of
a Participation Award to a Participant shall be evidenced by
an instrument or instruments in the form of the Participant
Award Agreement. Participation Awards previously granted to
Participants which have been forfeited pursuant to Section 6
due to termination of employment may be regranted to other
Participants. There is no minimum or maximum number of
Participant Awards that may be granted to a Participant.
Section 4. Awards.
(a) Change of Control Payment. In the event of a
Change of Control, each Participant that has received a
Participant Award shall become entitled to receive an amount
equal to such Participant's Value Increase Participation
Rate multiplied by the Value Increase Amount (as determined
in connection with such Change of Control). Such amounts
shall be paid in accordance with Section 5(a).
(b) Terminal Value Payment. In the event that a
Change of Control has not occurred prior to June 1, 2001,
each Participant that has received a Participant Award shall
become entitled to receive an amount equal to such
Participant's Value Increase Participation Rate multiplied
by the Value Increase Amount (as determined as of the
Terminal Value Measurement Date). Such amounts shall be
paid in accordance with Section 5(b).
(c) Offset for Deferred Bonus Payments. The
amount of each Participant Award shall be reduced by the
amount of any retention bonus payments under the 1999-2000
Retention Bonus Plan made to each such Participant by the
Company or SFC if so specified in such Participant's award.
Section 5. Time and Form of Award Payments.
(a) Timing of Payment; Change in Control. Awards
payable under the Plan as a result of a Change in Control
shall be paid to Participants by the Company no later than
ninety (90) days following the occurrence of such Change of
Control, except as provided in Section 6(a).
(b) Timing of Payment; Terminal Value Payment
Date. Awards payable under the Plan in the event a Change
of Control has not occurred by June 1, 2001 shall be paid to
Participants by the Company in one installment to be paid on
June 1, 2001.
(c) Eligibility. Except as set forth in Section
6 below, a Participant must be an Employee at the time a
payment is due in order to receive such payment.
(d) Method of Payment. All awards shall be paid
in cash, without interest thereon.
(e) Termination of Plan Upon Payment.
Participants shall be entitled to not more than one payment
under this Plan. Upon a Change of Control Payment or
Terminal Value Payment, this Plan shall terminate and shall
be of no further force or effect.
Section 6. Termination of Employment.
(a) Change of Control. To receive a Change of
Control Payment, a Participant must remain employed by the
Company through the occurrence of a Change of Control and
for a period of ninety (90) days thereafter, unless
following such Change of Control but prior to the end of
such ninety (90) day period, (i) the Participant dies or
becomes disabled (as defined in Section 22(e)(3) of the
Internal Revenue Code of 1986, as amended), (ii) is
terminated by the Company or its successor for any reason
other than cause or (iii) voluntarily terminates with Good
Reason as defined in such participants employment agreement
or severance agreement, in which case such Participant (or
his beneficiary) shall be paid in accordance with the terms
of the Plan within three (3) days of such event.
(b) Terminal Value Payment. To receive a
Terminal Value Payment, a Participant must remain employed
by the Company through June 1, 2001.
Section 7. Administration. The Plan shall be
administered by the Board of Directors. The Board may
establish rules and regulations for the administration of
the Plan, impose conditions with respect to competitive
employment or other activities with respect to any such
awards, and establish the written form to be used to
evidence such awards. The Board of Directors shall have
full authority to construe and interpret the terms and
provisions of the Plan, to adopt, alter, waive and repeal
such administrative rules, guidelines and practices
governing the Plan and to perform all acts, including
delegation of its responsibilities, as it shall, from time
to time, deem advisable, and to otherwise supervise the
administration of the Plan. All such rules, regulations and
interpretations relating to the Plan which are adopted by
the Board of Directors shall be conclusive and binding on
all parties. The Board of Directors may correct any defect,
supply any omission or reconcile any inconsistency in the
Plan or in any Award granted hereunder, in the manner and to
the extent it shall deem necessary to carry the Plan into
effect. No member of the Board of Directors or any person
or committee to whom responsibilities are delegated shall be
liable for any action or determination made in good faith
with respect to the Plan.
Section 8. Adjustments. In the event of any
acquisition, divestiture or other corporate transaction of
any kind involving the Company or its subsidiaries (which
does not constitute a Change of Control) which the
Committee, in its sole discretion, reasonably determines to
be of such a kind or nature as to make appropriate an
amendment or adjustment to the Plan or any Participation
Awards granted thereunder in order to effectuate the intent
and purposes of the Plan, the Committee may, in its sole
discretion, make such amendment or adjustment.
Section 9. Amendments and Termination. The Board
of Directors may amend or terminate the Plan at any time;
provided, however, that, except as set forth in Section 8,
no such amendment or termination shall materially and
adversely impair the rights of any Participant hereunder
without the written consent of Participants who, as of the
time of such amendment or termination, hold the right to
receive at least 66% of the total amounts which may then be
payable pursuant to all of the Participant Awards which
remain outstanding at such time; provided, however, that
nothing contained herein shall limit or restrict the
discretionary powers granted to the Board of Directors in
Sections 1 through 8 hereof.
Section 10. Miscellaneous.
(a) No Right to Awards or Continued Employment.
No Employee shall have any claim or right to be granted an
award under the Plan. Neither this Plan nor any action
taken hereunder shall be construed as giving any Employee
any right to be retained in the employ of the Company or any
subsidiary or affiliate thereof. Each Employee acknowledges
that he or she is an "at-will" employee of the Company.
Each Employee further acknowledges that nothing contained
herein shall alter such "at-will" employment status.
(b) No Rights of a Stockholder. The receipt of
Participant Awards by a Participant shall not entitle the
Participant to vote, to receive dividends or distributions,
to audit or review the Company's books and records, or to
otherwise act as a stockholder of the Company.
(c) Unfunded Plan. The Company shall not be
required to establish any special or separate fund or to
make any other segregation of assets to assure the payment
of any award under the Plan.
(d) Taxes/Other Deductions. The Company shall
have the right to deduct from all awards paid under the Plan
any federal, state or local taxes required by law to be
withheld with respect to such payments. In addition, the
Company shall have the right to deduct from all awards paid
under the Plan to a Participant any amounts owed by such
Participants to the arbitrator pursuant to the provisions of
Section 2(h).
(e) Relationship to Other Benefits. No payment
under the Plan shall be taken into account in determining
any benefits to which a Participant may be entitled under
any bonus, pension, profit sharing, group insurance or other
compensation or benefit plan, program or arrangement of the
Company or any of its affiliations.
(f) Nontransferability. No award made hereunder
may be assigned, pledged or transferred, except, in the
event of death of a Participant, by will or the laws of
descent and distribution, and any attempt to assign, pledge
or transfer such rights shall be void. Any payments
required under the Plan during a Participant's lifetime
shall be made only to the Participant. In the event any
conflicting demands are made upon the Company with respect
to any payments due as a result of this Plan, provided that
the Company shall not have received prior written notice
that said conflicting demands have been finally settled by
court adjudication, arbitration, joint order or otherwise,
the Company may pay to the Participant any and all amounts
it determines to be due hereunder and thereupon the Company
shall be fully relieved and discharged of any further duties
or liabilities under the Plan with respect to such payment.
(g) Governing Law/Jurisdiction. This Plan shall
be governed by, and construed in accordance with, the laws
of the State of Illinois applicable to agreements made and
to be performed entirely within such State (without regard
to any conflict of law provisions that might indicate the
applicability of any other laws). SFC, the Company and each
Participant who is granted a Participant Award (as a
condition to such grant) hereby irrevocably and
unconditionally consents to submit to the exclusive
jurisdiction of the courts of the State of Illinois and of
the United States of America located in the City of Chicago
for any actions, suits or proceedings arising out of or
relating to the Plan and agrees not to commence any action,
suit or proceeding relating hereto except in such courts.
The parties hereby irrevocably and unconditionally waive any
objection to the laying of venue of any action, suit or
proceeding arising under the Plan in the courts of the State
of Illinois or the United States of America located in the
City of Chicago, and hereby further irrevocably and
unconditionally waive and agree not to plead or claim in any
such court that any such action, suit or proceeding brought
in any such court has been brought in an inconvenient forum.
(h) Expenses. The Company shall bear all
expenses incurred in connection with the administration of
the Plan, but shall not be responsible for taxes or other
expenses incurred by the Participants.
(i) Entire Agreement. This Plan and the Exhibit
A applicable to each Participant set forth the entire
agreement and understanding of the parties relating to the
subject matter hereof, and supersede all prior agreements,
arrangements and understandings, written or oral, relating
to the subject matter hereof. No representation, promise or
inducement has been made by either party that is not
embodied in this Agreement, and neither party shall be bound
by or liable for any illegal representation, promise of
inducement not so set forth.
Section 11. Effective Date. Subject to the approval
of the Board of Directors, this Plan shall become effective
as of March 15, 2000.
EXHIBIT A
Date of Grant:
Participant:
MOTHER'S CAKE & COOKIE CO.
SUPPLEMENTAL LONG TERM INCENTIVE PLAN
FOR KEY EMPLOYEES
PARTICIPATION AWARD AGREEMENT dated as of May __, 1999
by and between MOTHER'S CAKE & COOKIE CO., a California
corporation (the "Company"), and ______________________ (the
"Participant").
All words and phrases not otherwise expressly defined
herein shall have the same meanings as are ascribed to such
words and phrases in the Mother's Cake & Cookie Co.
Supplemental Long Term Incentive Plan for Key Employees (the
"Plan").
The Board of Directors has determined that the
objectives of the Plan will be furthered by granting to the
Participant Participation Units in the Plan.
In consideration of the foregoing and of the mutual
undertakings set forth in this Agreement, the Company and
the Participant agree as follows:
Section 1 Grant of Participation Unit. Subject to the
provisions of the Plan and this Agreement, the Company
hereby grants to the Participant a Value Increase
Participation Rate under the Plan equal to an amount equal
to _______ percent (__%) of the Value Increase Amount (the
"Value Increase Participation Rate").
[Only to the extent applicable, as determined by the Board
in its discretion: Notwithstanding anything herein to the
contrary, the amount of an award payable to a Participant
under this Plan shall be reduced by the amount of any
payments made under the 1999-2000 Retention Bonus Program to
such Participant by the Company or SFC.]
Section 2 Plan Provisions to Prevail. This Agreement
shall be subject to all of the terms and provisions of the
Plan, which are incorporated hereby and made a part hereof.
In the event there is any inconsistency between the
provisions of this Agreement and the Plan, the provisions of
the Plan shall govern.
Section 3 Participant's Acknowledgments. The
Participant agrees and acknowledges that he has received and
read a copy of the Plan, and accepts this grant upon all of
the terms thereof.
Section 4 Non-Transferability. No grant to the
Participant under the Plan shall be assignable or
transferable by the Participant (whether by operation of law
or otherwise and whether voluntarily or involuntarily),
other than by will or by the laws of descent and
distribution. During the lifetime of the Participant, all
rights granted to the Participant under the Plan shall be
exercisable only by the Participant.
Section 5 Notices. Any notice to be given to SFC
hereunder shall be in writing and shall be addressed to
Specialty Foods Corporation, 520 Lake Cook Road, Deerfield,
IL 60015, Attention: Vice President and General Counsel or
at such other address as SFC may hereafter designate to the
Participant by notice as provided herein. Any notice to be
given to Mother's hereunder shall be in writing and shall be
addressed to Mother's Cake & Cookie Co., 810 81st Avenue,
Oakland, CA 94621, Attention: Vice President - Human
Resources. Any notice to be given to the Participant
hereunder shall be addressed to the Participant at the
address of the Participant's principal place of employment
or at such other address as the Participant may hereafter
designate to SFC by notice as provided herein. Notices
hereunder shall be deemed to have been duly given when
received by personal delivery or by registered or certified
mail to the party entitled to receive the same.
Section 6 Successors and Assigns. This Agreement shall
be binding upon and inure to the benefit of the parties
hereto and the successors and assigns of the Company and, to
the extent set forth in the Plan, the heirs and personal
representatives of the Participant.
Section 7 Modifications to Agreement. This Agreement
may not be altered, modified, changed or discharged, except
by a writing signed by or on behalf of both the Company and
the Participant.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date and year first above written.
MOTHER'S CAKE, & COOKIE CO.,
a California corporation
/s/Patrick O'Dea
______________________________
By:
Name: Patrick O'Dea
Title: President and
Chief Executive Officer
Agreed to and Accepted:
_________________________
Participant
