<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
CAMPBELL SOUP COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- --------------------------------------------------------------------------------
(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
- --------------------------------------------------------------------------------
<PAGE> 2
[Campbell Soup Company Logo]
CAMPBELL PLACE
CAMDEN, NEW JERSEY 08103-1799
OCTOBER 8, 1999
NOTICE OF ANNUAL MEETING OF SHAREOWNERS
THURSDAY, NOVEMBER 18, 1999
11:00 A.M., CENTRAL TIME
CIVIC CENTER
2025 SOUTH COLLEGIATE DRIVE
PARIS, TEXAS 75460
AGENDA
1. ELECT DIRECTORS.
2. RATIFY APPOINTMENT OF AUDITORS.
3. REAPPROVE THE COMPANY'S 1994 LONG-TERM INCENTIVE PLAN.
4. REAPPROVE THE COMPANY'S MANAGEMENT WORLDWIDE INCENTIVE PLAN.
5. TRANSACT ANY OTHER BUSINESS PROPERLY BROUGHT BEFORE THE MEETING.
Shareowners of record at the close of business on September 20, 1999, will
be entitled to vote.
Your vote is important. Kindly SIGN, DATE AND RETURN THE ENCLOSED PROXY
CARD IN THE ENVELOPE PROVIDED OR VOTE BY PHONE OR THE INTERNET (see instructions
on proxy card), in order that as many shares as possible will be represented.
By Order of the Board of Directors,
/s/ JOHN J. FUREY
John J. Furey
Corporate Secretary
IMPORTANT
Please note that a ticket is required for admission to the meeting. If you
plan to attend and shares are registered in your name as of September 20, 1999,
please check the appropriate box on your proxy card or when voting on the
Internet or indicate when prompted if voting by telephone. A ticket of admission
will be forwarded to you. If your shares are held in the name of a broker or
other nominee, please follow the instructions on page 32 to obtain an admission
ticket.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PROXY STATEMENT PAGE
--------------- ----
<S> <C> <C>
* Item 1 -- Election of Directors............................. 1
Security Ownership of Directors and Executive Officers...... 5
Security Ownership of Certain Beneficial Owners............. 6
Director Attendance......................................... 8
Director Compensation....................................... 8
Board Committees............................................ 9
Certain Relationships and Related Transactions.............. 11
Corporate Governance........................................ 11
Compensation of Executive Officers.......................... 15
-- Compensation and Organization Committee's Report on
Executive Compensation.................................. 15
-- Compensation and Organization Committee Interlocks and
Insider Participation................................... 19
-- Summary Compensation Table.............................. 20
-- Option Grants in Last Fiscal Year....................... 22
-- Aggregated Option Exercises in Last Fiscal Year and
Fiscal Year-End Option Values........................... 22
-- Return to Shareowners Performance Graph................. 23
-- Pension Plans........................................... 23
-- Termination Arrangements................................ 24
* Item 2 -- Ratification of Appointment of Auditors........... 25
* Item 3 -- Reapproval of the Company's 1994 Long-Term
Incentive Plan.............................................. 26
* Item 4 -- Reapproval of the Company's Management Worldwide
Incentive Plan.............................................. 29
Submission of Shareowner Proposals.......................... 30
Directors and Executive Officers Stock Ownership Reports.... 30
Other Matters............................................... 30
Proxies and Voting at the Meeting........................... 30
Information About Attending the Meeting..................... 32
Appendix A -- 1994 Long-Term Incentive Plan
Appendix B -- Management Worldwide Incentive Plan
</TABLE>
- ------------------
* Denotes items to be voted on at the meeting.
NOTE: SHAREOWNERS MAY RECEIVE A COPY OF THE COMPANY'S ANNUAL FORM 10-K
REPORT, WITHOUT CHARGE BY:
(1) WRITING TO INVESTOR RELATIONS, CAMPBELL SOUP COMPANY, CAMPBELL PLACE,
CAMDEN, NJ 08103-1799;
(2) CALLING 1-888-747-SOUP (1-888-747-7687); OR
(3) LEAVING A MESSAGE ON CAMPBELL'S HOME PAGE AT HTTP://WWW.CAMPBELLSOUP.COM.
<PAGE> 4
ITEM 1
ELECTION OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL NOMINEES
The Board of Directors of the Company, pursuant to the By-Laws, has
determined that the number of Directors of the Company shall be sixteen. The
directors are to be elected to hold office until the next Annual Meeting of the
Shareowners and until their successors are elected and shall have qualified.
Directors are elected by a plurality of the votes cast. Except as otherwise
specified in the proxy, proxies will be voted for election of the nominees named
below.
If a nominee becomes unable or unwilling to serve, proxies will be voted
for election of such person as shall be designated by the Board of Directors.
Management knows of no reason why any nominee shall be unable or unwilling to
serve.
The following table sets forth certain information concerning the nominees
at September 20, 1999:
<TABLE>
<CAPTION>
(1) PRINCIPAL OCCUPATION OR EMPLOYMENT DIRECTOR
NAME (2) OTHER BUSINESS AFFILIATIONS AGE SINCE
---- -------------------------------------- --- --------
<S> <C> <C> <C>
(1) Retired Senior Scientific Adviser to the 67 1986
Alva A. App United Nations Development Programme.
(1) President and Chief Executive Officer of 57 1990
Edmund M. Carpenter Barnes Group Inc since December 1998.
Previously Senior Managing Director of Clayton
Dubilier & Rice. Former Chairman and Chief
Executive Officer of General Signal
Corporation.
(2) Director of Barnes Group Inc, Dana
Corporation and Texaco, Inc.
(1) Private investor and Chairman and Managing 53 1989
Bennett Dorrance Director of DMB Associates in Phoenix, Arizona.
(2) Director of Bank One Corp.
</TABLE>
1
<PAGE> 5
<TABLE>
<CAPTION>
(1) PRINCIPAL OCCUPATION OR EMPLOYMENT DIRECTOR
NAME (2) OTHER BUSINESS AFFILIATIONS AGE SINCE
---- -------------------------------------- --- --------
<S> <C> <C> <C>
(1) Management Consultant, Field & Associates. 65 1987
Previously Chairman and Chief Executive Officer
Thomas W. Field, Jr. of ABCO Foods, Inc. Former Chairman, President
and Chief Executive Officer of McKesson
Corporation.
(2) Director of Maxicare Health, Inc. and
Stater Brothers Market, Inc.
(1) President of GTE Corporation since 1995. 55 1996
Previously Vice Chairman and President,
Kent B. Foster Telephone Operations, GTE Corporation.
(2) Director of GTE Corporation, J.C. Penney
Company, Inc. and New York Life Insurance
Company.
(1) Chairman and Chief Executive Officer of 60 1996
American Express Company since 1993. Previously
Harvey Golub Vice Chairman of American Express Company and
Chief Executive Officer of American Express
Financial Advisors.
(2) Director of American Express Company and
Dow Jones & Company, Inc.
(1) Chairman and Chief Executive of The Bank of 60 1995
East Asia, Limited since 1991.
David K. P. Li
(2) Director of Dow Jones & Company, Inc., Hong
Kong Telecommunications, Ltd., The Bank of East
Asia, Limited, The Hong Kong & China Gas
Company Limited, Sime Darby Hong Kong Limited.
(1) Chairman of Campbell Soup Company since 63 1984
August 1999. Former Chairman and Chief
Philip E. Lippincott Executive Officer of Scott Paper Company.
(2) Director of Exxon Corporation. Trustee of
The Penn Mutual Life Insurance Company.
</TABLE>
2
<PAGE> 6
<TABLE>
<CAPTION>
(1) PRINCIPAL OCCUPATION OR EMPLOYMENT DIRECTOR
NAME (2) OTHER BUSINESS AFFILIATIONS AGE SINCE
---- -------------------------------------- --- --------
<S> <C> <C> <C>
(1) Private investor and President of Iron 49 1990
Spring Farm, Inc.
Mary Alice D. Malone
(1) President and Chief Executive Officer of 50 1997
Campbell Soup Company since July 15, 1997.
Dale F. Morrison Previously Senior Vice President of Campbell
Soup Company and President of International and
Specialty Foods Division (1996-1997); Vice
President of Campbell Soup Company and
President of Pepperidge Farm (1995-1996); and
President-Frito Lay North (1994-1995).
(1) President and Chief Executive Officer of 67 1990
John W. Bristol & Co., Inc., an investment
Charles H. Mott management firm.
(1) Chairman and Chief Executive Officer of 54 1999
Avon Products, Inc.; Vice Chairman and Chief
Charles R. Perrin Executive Officer of Avon Products, Inc. from
January 1998-July 1998. Former Chairman and
Chief Executive Officer of Duracell
International, Inc. (1994-1996).
(2) Director of Avon Products, Inc.
(1) President and Chief Executive Officer of 58 1995
Danaher Corporation since 1990.
George M. Sherman
(2) Director of Danaher Corporation.
</TABLE>
3
<PAGE> 7
<TABLE>
<CAPTION>
(1) PRINCIPAL OCCUPATION OR EMPLOYMENT DIRECTOR
NAME (2) OTHER BUSINESS AFFILIATIONS AGE SINCE
---- -------------------------------------- --- --------
<S> <C> <C> <C>
(1) Senior Program Officer of the Carnegie 61 1992
Corporation since July 1999. Previously
Donald M. Stewart President and Chief Executive Officer of The
College Board.
(2) Director of Principal Financial Group and
The New York Times Company.
(1) Private investor. 61 1988
George Strawbridge, Jr. (2) Director of Buffalo Sabres of the National
Hockey League.
(1) Private investor and President and Chief 56 1990
Executive Officer of Live Oak Stud and Live Oak
Charlotte C. Weber Properties.
</TABLE>
4
<PAGE> 8
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information regarding beneficial ownership
of Campbell's Capital Stock, as of September 20, 1999, of each Director, the
Company's five most highly compensated Executive Officers and the Directors and
Executive Officers as a group, and also sets forth Campbell stock units credited
to the individual's deferred compensation account. The account reflects the
election of the individuals to defer previously earned compensation and pending
awards of restricted performance stock into Campbell stock units. The
individuals are fully at risk as to the price of Campbell stock in their
deferred stock accounts. Additional stock units are credited to the accounts to
reflect accrual of dividends. The stock units do not carry any voting rights.
Unrestricted deferred Campbell stock units are included in calculating the
Company required stock ownership for directors and executives.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
AGGREGATE NUMBER TOTAL NUMBER OF
OF SHARES CAMPBELL STOCK SHARES AND
NAME BENEFICIALLY OWNED(a) DEFERRED DEFERRED STOCK
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alva A. App 14,721(b) 12,907 27,628
- ------------------------------------------------------------------------------------------------------------
Edmund M. Carpenter 13,235 9,839 23,074
- ------------------------------------------------------------------------------------------------------------
Bennett Dorrance 52,573,805(c) 7,440 52,581,245
- ------------------------------------------------------------------------------------------------------------
Thomas W. Field, Jr. 36,613 22,804 59,417
- ------------------------------------------------------------------------------------------------------------
Kent B. Foster 2,864 10,001 12,865
- ------------------------------------------------------------------------------------------------------------
Harvey Golub 6,338 9,647 15,985
- ------------------------------------------------------------------------------------------------------------
David K. P. Li 10,401 11,373 21,774
- ------------------------------------------------------------------------------------------------------------
Philip E. Lippincott 20,133 4,141 24,274
- ------------------------------------------------------------------------------------------------------------
Mary Alice D. Malone 54,122,561(d) 8,803 54,131,364
- ------------------------------------------------------------------------------------------------------------
Dale F. Morrison 349,765 333,550 683,315
- ------------------------------------------------------------------------------------------------------------
Charles H. Mott 59,077,055(e) 12,967 59,090,022
- ------------------------------------------------------------------------------------------------------------
Charles R. Perrin 5,000 1,455 6,455
- ------------------------------------------------------------------------------------------------------------
George M. Sherman 6,601 13,667 20,286
- ------------------------------------------------------------------------------------------------------------
Donald M. Stewart 10,602 6,913 17,515
- ------------------------------------------------------------------------------------------------------------
George Strawbridge, Jr. 8,217,018(f) 3,338 8,220,356
- ------------------------------------------------------------------------------------------------------------
Charlotte C. Weber 22,131,439(g) 3,961 22,135,400
- ------------------------------------------------------------------------------------------------------------
F. Martin Thrasher 225,751 38,754 264,505
- ------------------------------------------------------------------------------------------------------------
Craig W. Rydin 105,638 26,626 132,264
- ------------------------------------------------------------------------------------------------------------
Basil L. Anderson 327,476 143,697 471,173
- ------------------------------------------------------------------------------------------------------------
Andrew K. Hughson 56,435 284 56,719
- ------------------------------------------------------------------------------------------------------------
All directors and executive officers
as a group (26 persons) 197,832,707 830,461 198,663,168
- ------------------------------------------------------------------------------------------------------------
</TABLE>
(a) The shares shown include 1,388,845 shares of Capital Stock with respect to
which Directors and Executive Officers have a right, as of November 20,
1999, to acquire beneficial ownership because of vested stock options. All
persons listed own less than 1% of the company's outstanding shares of
Capital Stock, except:
<TABLE>
<CAPTION>
% OF OUTSTANDING
SHARES
----------------
<S> <C>
Bennett Dorrance 12.3%
Mary Alice D. Malone 12.7%
Charles H. Mott 13.8%
George Strawbridge, Jr. 1.9%
Charlotte C. Weber 5.2%
</TABLE>
All Directors & Executive Officers (26 persons) as a group beneficially own
46.2% of the outstanding shares.
5
<PAGE> 9
(b) Share ownership shown does not include 468 shares held by Alva App's wife,
as to which he disclaims beneficial ownership.
(c) Bennett Dorrance is a grandson of John T. Dorrance, the brother of Mary
Alice Malone, and a cousin of George Strawbridge and Charlotte C. Weber.
Share ownership shown does not include 491,188 shares held as guardian for
one of his children nor 491,232 shares held as trustee for one of his
children, as to which shares he disclaims beneficial ownership. Reference
is also made to "Principal Shareowners." Does not include 450,700 shares
held by the Dorrance Family Foundation.
(d) Mary Alice D. Malone is a granddaughter of John T. Dorrance. Share
ownership shown does not include 131,424 shares held by trusts for her
children, as to which shares she disclaims beneficial ownership. Reference
is also made to "Principal Shareowners."
(e) Share ownership shown for Charles Mott includes 59,050,400 shares held by
the Voting Trust over which he, as a Trustee, has shared voting power.
Reference is also made to "Principal Shareowners." In September 1990 the
Trustees of the Voting Trust requested the Company's Governance Committee
to nominate Charles Mott as a candidate for election as a director.
(f) George Strawbridge is a grandson of John T. Dorrance and a cousin of
Charlotte Weber. Share ownership shown does not include 12,543,846 shares
held by various trusts, of which he is a trustee, for the benefit of his
sister and her children, as to which shares he disclaims beneficial
ownership. Does not include 2,258,784 shares held by trusts for the benefit
of his descendants as to which shares he disclaims beneficial ownership.
(g) Charlotte Weber is a granddaughter of John T. Dorrance. Share ownership
shown includes 22,052,192 shares held by two trusts of which she is a
co-trustee and 81,928 shares held by a foundation of which she is also a
co-trustee, for all of which she has shared voting and dispositive power.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
At the close of business on September 20, 1999, the record date for the
meeting, there were outstanding and entitled to vote 427,836,506 shares of
Campbell Capital Stock, all of one class and each having one vote. The holders
of a majority of the shares outstanding and entitled to vote, present in person
or represented by proxy, constitute a quorum for the meeting.
PRINCIPAL SHAREOWNERS
Information concerning the owners of more than 5% of the outstanding
Campbell Capital Stock as of the record date for the meeting follows:
<TABLE>
<CAPTION>
PERCENT OF
AMOUNT/NATURE OF OUTSTANDING
NAME/ADDRESS BENEFICIAL OWNERSHIP STOCK
- ------------ -------------------- -----------
<S> <C> <C>
Bennett Dorrance.......................................... 52,573,805 Note (1) 12.3%
DMB Associates,
7600 E. Doubletree Ranch Road
Suite 300
Scottsdale, AZ 85258
Mary Alice D. Malone...................................... 54,122,561 Note (2) 12.7%
Iron Spring Farm, Inc.
75 Old Stottsville Road
Coatesville, PA 19320
Charlotte C. Weber........................................ 22,131,439 Note (3) 5.2%
Live Oak Properties,
P.O. Box Drawer 2108
Ocala, FL 34478
</TABLE>
6
<PAGE> 10
<TABLE>
<CAPTION>
PERCENT OF
AMOUNT/NATURE OF OUTSTANDING
NAME/ADDRESS BENEFICIAL OWNERSHIP STOCK
- ------------ -------------------- -----------
<S> <C> <C>
Dorrance H. Hamilton, Charles H. Mott and
John A. van Beuren, Voting Trustees under the Major
Stockholders' Voting Trust dated as of June 2, 1990
("Voting Trust") and related persons, .................... 59,634,445 Note (4) 13.9%
P. O. Box 4098
Middletown, RI 02842
Note (5)
</TABLE>
- ------------------
(1) A director nominee. See note (c) on page 6. The shares shown include 4,133
shares of Capital Stock with respect to which Bennett Dorrance has the right
to acquire beneficial ownership because of vested stock options.
(2) A director nominee. See note (d) on page 6. The shares shown include 4,133
shares of Capital Stock with respect to which Mary Alice D. Malone has the
right to acquire beneficial ownership because of vested stock options.
(3) A director nominee. See note (g) on page 6. The shares shown include 4,133
shares of Capital Stock with respect to which Charlotte Weber has the right
to acquire beneficial ownership because of vested stock options.
(4) Charles Mott is a director nominee. See note (e) on page 6. Includes
59,050,400 shares (13.8% of the outstanding shares) held by the Voting
Trustees with sole voting power and 584,045 shares held by participants
outside the Voting Trust or by persons related to them, for a total of
59,634,445 shares (13.9% of the outstanding shares). Includes (i) 28,362,860
shares (6.6% of the outstanding shares) with shared dispositive power held
by three trusts, of which Dorrance Hamilton is a trustee, 200 Eagle Road,
Suite 316, Wayne, PA 19087, and (ii) 6,753,918 shares with sole dispositive
power held by Hope H. van Beuren and 6,717,130 shares with sole dispositive
power held by her husband, John van Beuren, P.O. Box 4098, Middletown, RI
02842. John and Hope van Beuren also hold 13,805,568 shares with shared
dispositive power, including shares held by family partnerships.
Participants in the Voting Trust have certain rights to withdraw shares
deposited with the Voting Trustees including the right to withdraw these
shares prior to any annual or special meeting of the Company's shareowners.
Dispositive power as used above means the power to direct the sale of the
shares; in some cases it does not include the power to direct how the
proceeds of sale can be used. The Voting Trust was formed by certain
descendants (and spouses, fiduciaries and a related foundation) of the late
John T. Dorrance. The participants have indicated that they formed the
Voting Trust as a vehicle for acting together as to matters which may arise
affecting the Company's business, in order to obtain their objective of
maximizing the value of their shares.
The Trustees will act for participants in communications with the Company's
Board of Directors. Participants believe the Voting Trust may also
facilitate communications between the Board and the participants.
(5) Under the Voting Trust Agreement, all shares held by the Voting Trust will
be voted by the Trustees whose decision must be approved by at least two
Trustees if there are three Trustees then acting. In the event of a
disagreement among the Trustees designated by the family groups
participating in the Voting Trust, the shares of the minority may be
withdrawn. The Voting Trust continues for ten years from June 2, 1990,
unless it is sooner terminated or extended.
The foregoing information relating to Shareowners is based upon the
Company's stock records and data supplied to the Company by the holders as of
the record date for the meeting.
7
<PAGE> 11
DIRECTOR ATTENDANCE
During fiscal 1999 (ended August 1), the Board of Directors met eight
times, seven regular meetings and one special meeting. Directors meet their
responsibilities by attending Board and Committee meetings and through
communication with the Chairman, the Chief Executive Officer and other members
of management on matters affecting the Company. All directors attended at least
75% of scheduled Board meetings and meetings held by Committees of which they
were members, except Donald Stewart who attended 68%.
DIRECTOR COMPENSATION
The following table displays all components of Director compensation in
fiscal 1999:
<TABLE>
<CAPTION>
<S> <C>
- ---------------------------------------------------------------------------------------------
Annual Board Retainer* 2,400 shares of Campbell stock
- ---------------------------------------------------------------------------------------------
Annual Option Grant** 2,000 options
- ---------------------------------------------------------------------------------------------
Annual Retainer for Committee Chair $4,000
- ---------------------------------------------------------------------------------------------
Board Attendance Fee (per in-person meeting) $1,250
- ---------------------------------------------------------------------------------------------
Board Attendance Fee (per conference call meeting) $625
- ---------------------------------------------------------------------------------------------
Committee Attendance Fee (per in-person meeting) $1,000
- ---------------------------------------------------------------------------------------------
Committee Attendance Fee (per conference call meeting) $500
- ---------------------------------------------------------------------------------------------
</TABLE>
- ------------------
* Campbell shares are issued and options are granted to each director on
January 1 of each year.
** Options granted on January 1, 1999, had an exercise price of $54.625. Options
are granted at the market price on the grant date and may not be repriced.
David Johnson, who was the non-executive Chairman during all of fiscal
1999, received a retainer of $400,000 in addition to the regular retainer and
fees paid to all non-employee directors. Mr. Johnson did not receive any other
compensation for service as a Director. Dale Morrison received no remuneration
for service as a Director. Directors have the option to elect to receive
Campbell stock instead of any cash payments and to defer all or a portion of
compensation. Directors are reimbursed for actual travel costs.
PROPOSAL TO REDUCE DIRECTOR COMPENSATION
Based upon a review of competitive data, the Board recommends that Director
compensation be reduced from an annual value of approximately $160,000 in
calendar 1999 (based on a $44 stock price) to an annual value of approximately
$113,000 for calendar year 2000. The Board believes that current Director
compensation is high when compared to that paid by the Performance Peer Group
(15 food companies that include Campbell's key competitors). In addition, the
Board recommends that the components of the compensation package be changed to
link compensation more closely to returns to shareowners. The proposed changes
regarding stock and options to be awarded to Directors as part of a revised
compensation program require amendments to the Company's 1994 Long-Term
Incentive Plan that are explained on page 28.
BENEFITS
The Company does not provide pensions, medical benefits or other benefit
programs to directors.
8
<PAGE> 12
BOARD COMMITTEES
Pursuant to the by-laws, the Board had established five standing committees
as of the record date. The Committees are Audit, Compensation and Organization,
Executive, Finance and Corporate Development, and Governance. Membership as of
the record date was as follows:
<TABLE>
<CAPTION>
COMPENSATION
AUDIT AND ORGANIZATION EXECUTIVE
- ----- ---------------- ---------
<S> <C> <C>
G.M. Sherman, Chair P.E. Lippincott, Chair P.E. Lippincott, Chair
A. A. App E.M. Carpenter A.A. App
K. B. Foster T.W. Field, Jr. B. Dorrance
H. Golub H. Golub T.W. Field, Jr.
M.D. Malone M.D. Malone D. F. Morrison
C.R. Perrin G. Strawbridge, Jr. G. Strawbridge, Jr.
D.M. Stewart C.C. Weber
C.C. Weber
</TABLE>
<TABLE>
<CAPTION>
FINANCE AND
CORPORATE DEVELOPMENT GOVERNANCE
- --------------------- ----------
<S> <C> <C>
C.H. Mott, Co-Chair G. Strawbridge, Jr., Chair
B. Dorrance, Co-Chair A.A. App
E. M. Carpenter B. Dorrance
D.K.P. Li T. W. Field, Jr.
P.E. Lippincott K.B. Foster
D. F. Morrison C.H. Mott
G.M. Sherman
D.M. Stewart
</TABLE>
AUDIT COMMITTEE 4 meetings in fiscal 1999
-- Recommends the appointment of the Company's independent accountants;
-- Reviews the scope and results of the audit plans of the independent
accountants and the internal auditors;
-- Oversees the scope and adequacy of the Company's internal accounting
control and record-keeping systems;
-- Reviews the objectivity, effectiveness and resources of the internal
audit function which reports directly to the Committee;
-- Confers independently with the internal auditors and the independent
accountants;
-- Reviews non-audit services to be performed by the independent
accountants; and
-- Determines the appropriateness of fees for audit and non-audit services
performed by the independent accountants.
COMPENSATION AND ORGANIZATION COMMITTEE 7 meetings in fiscal 1999
-- Develops and recommends to the Board an annual performance evaluation of
the Chief Executive Officer;
-- Reviews and recommends to the Board salary and incentive compensation,
including bonus, stock options and restricted stock, for the Chief
Executive Officer;
-- Reviews and approves the salaries and incentive compensation for all
corporate officers and senior executives;
-- Reviews and approves the short-term and long-term incentive compensation
programs, including the performance goals;
9
<PAGE> 13
-- Reviews the salary structure and the apportionment of compensation among
salary and short-term and long-term incentive compensation;
-- Reviews and approves the incentive compensation to be allocated to
employees;
-- Reviews and recommends to the Board significant changes in the design of
employee benefit plans;
-- Reviews, prior to becoming effective, any major organization change that
the Chief Executive Officer intends to implement; and
-- Reviews executive organization and principal programs for executive
development, and annually reports to the Board on management development
and succession planning.
EXECUTIVE COMMITTEE No meetings in fiscal 1999
-- Exercises all the powers of the Board when the Board is not in session,
except as otherwise provided by New Jersey law.
FINANCE AND CORPORATE DEVELOPMENT 7 meetings in fiscal 1999
-- Reviews and recommends to the Board all issuances, sales or repurchases
of equity and long-term debt;
-- Reviews and recommends changes in the Company's capital structure;
-- Reviews and recommends the capital budget and capital expenditure
program;
-- Reviews and recommends acquisitions, divestitures, joint ventures,
partnerships or combination of business interests;
-- Recommends proposed appointments to the Administrative Committee of the
pension plans; and
-- Oversees the administration and the investment policies and practices of
the Company's retirement and pension plans.
GOVERNANCE COMMITTEE 7 meetings in fiscal 1999
Reviews and makes recommendations to the Board regarding:
-- The organization and structure of the Board;
-- Qualifications for director candidates;
-- Candidates for election to the Board;
-- Evaluation of the Chairman's performance;
-- Candidate for the position of Chairman of the Board;
-- Chairpersons and members for appointment to the Board Committees;
-- Remuneration for Board members who are not employees; and
-- The role and effectiveness of the Board, the respective Board Committees
and the Directors in the Company's corporate governance process.
The Governance Committee seeks potential nominees for Board membership in
various ways and will consider suggestions submitted by shareowners. Such
suggestions, together with appropriate biographical information, should be
submitted to the Corporate Secretary of the Company.
Actions taken by any of the foregoing committees are reported to the Board
and the Board receives a copy of the minutes of all Committee meetings.
10
<PAGE> 14
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Bennett Dorrance and Mary Alice D. Malone are directors of Campbell and
each own more than 10% of the common stock of Vlasic Foods International Inc.
("Vlasic"). During fiscal 1999 Campbell paid Vlasic approximately $142.3 million
related to: (1) contract manufacturing of frozen food products for Campbell's
food service business in the U.S.; (2) supply agreements for mushrooms and
processed beef; (3) distribution services agreements; and (4) other
transactions. Vlasic paid Campbell during fiscal 1999 approximately $20.3
million for contract manufacturing of frozen food products in Canada and certain
transition services, such as benefits record keeping, computer processing and
other services following the spinoff of Vlasic from Campbell.
CORPORATE GOVERNANCE
The Board of Directors is responsible for the control and direction of the
Company. It represents and is accountable only to shareowners. The Board's prime
purpose is to build long-term shareowner wealth.
Corporate governance is designed to drive superior performance of the
Company by making the most effective use of the collective skills and experience
of directors. Campbell believes that good governance is a source of competitive
advantage.
CORPORATE GOVERNANCE STANDARDS
Campbell first published Corporate Governance Standards in its proxy in
1992. The Standards are reviewed annually by the Board. The Company's twenty
Standards for 1999 are as follows:
I. BOARD PERFORMANCE
1. All directors will stand for election every year.
2. Directors are required to own at least 2,000 Campbell shares within one
year of election, and 6,000 shares within three years of election.
3. Directors will operate in accordance with the Requirements of Directors
(printed at page 13, below).
4. The Governance Committee will conduct annual evaluations of the Board's
effectiveness, and report the results to shareowners in the proxy
statement. (In 1999, the Board evaluation process focused on the
Committee System. See "Evaluations of Board Performance" at pages
13-14, below).
II. BOARD COMPOSITION
5. The Board believes that, as a general rule, former Campbell executives
should not serve on the Board.
6. Interlocking directorships will not be allowed, except with respect to
joint ventures. (An interlocking directorship would occur if a Campbell
officer served on the Board of Company X and an officer of Company X
served on the Campbell Board, or if a major supplier or customer served
on Campbell's Board.)
7. Directors may not stand for reelection after age 70.
8. The Audit, Compensation/Organization and Governance Committees will
consist entirely of independent directors. For this purpose, an
"independent" director is one who has no present or former employment
by the Company and no significant financial or personal tie to the
Company other than share ownership and entitlement to director fees.
9. The Board will appoint Committee members and Committee Chairmen.
11
<PAGE> 15
10. When the CEO also holds the position of Chairman of the Board, the
Chairman of the Governance Committee will serve as the Lead Director to
moderate executive sessions of independent directors and to provide
oversight for the effective functioning of the Board.
III. BUSINESS OPERATIONS
11. The Board will annually review and approve a long-term strategic plan
and a one-year operating plan which integrates with strategic plan
milestones.
12. The Board will evaluate the performance of the CEO at least annually in
meetings of independent directors that are not attended by the CEO. See
"CEO Compensation and Evaluation," at pages 18-19, below.
13. The CEO will report annually to the Compensation and Organization
Committee and to the Board on the Company's management development and
planning for executive succession. The Compensation and Organization
Committee will review and annually report to the Board on the
effectiveness of these processes.
14. In advance of Board and Committee meetings, directors will receive
appropriate materials relating to the items to be acted upon at those
meetings.
IV. EXECUTIVE COMPENSATION
15. Incentive compensation plans for executives shall link pay directly and
objectively to measured financial goals set in advance by the
Compensation and Organization Committee. (See Compensation and
Organization Committee's Report at pages 15 to 19, below.)
16. By express terms of the shareowner-approved incentive plan, stock
options may not be repriced. The exercise price for options will not be
reduced even if the current market price of the stock is below the
exercise price.
17. All executives (approximately 300 persons) must buy and hold Campbell
stock valued at one-half to seven times base salary, depending on their
positions. Restricted stock and options, including vested stock
options, shall not count toward the satisfaction of this requirement.
V. SHAREOWNERS
18. The Company does not have a poison pill, staggered board, or similar
anti-takeover devices because it believes that the way to remain
independent is by means of superior performance in building shareowner
wealth.
19. All shareowners have equal voting rights.
20. The Board will develop, approve and annually review Corporate
Governance Standards that are distributed each year to shareowners in
the proxy statement.
12
<PAGE> 16
REQUIREMENTS OF MANAGEMENT AND DIRECTORS
In order to declare clear expectations of performance, in 1995 the Board
adopted and distributed to shareowners in the proxy statement the specific
requirements of management and directors set forth below.
<TABLE>
<CAPTION>
BOARD REQUIREMENTS
OF MANAGEMENT
------------------
<C> <S>
-- Develop strategies to deliver strong
market franchises and build shareowner
wealth over the long term
-- Recommend appropriate strategic and
operating plans
-- Maintain effective control of operations
-- Measure performance against peers
-- Provide strong, principled and ethical
leadership
-- Assure sound succession planning and
management development
-- Maintain sound organizational structure
-- Inform the Board regularly regarding the
status of key initiatives
-- No surprises
-- Organize Board meetings which are well-
planned, allow meaningful participation
and provide for timely resolution of
issues
-- Provide Board materials which contain
the right amount of information and are
received sufficiently in advance of
meetings
</TABLE>
<TABLE>
<CAPTION>
CAMPBELL REQUIREMENTS
OF DIRECTORS
---------------------
<C> <S>
-- Act in the best interests of all
shareowners
-- Critique and approve strategic and
operating plans
-- Select, motivate, evaluate and
compensate the CEO
-- Develop and maintain a sound
understanding of Campbell's strategies
and businesses
-- Review succession planning and
management development
-- Advise and consult on key organizational
changes
-- Carefully study Board materials and
issues
-- Provide active, objective and
constructive participation at meetings
of the Board and committees
-- Provide assistance in representing
Campbell to the outside world
-- Counsel on corporate issues
-- Develop and maintain a good
understanding of general economic trends
and corporate governance
</TABLE>
EVALUATIONS OF BOARD PERFORMANCE
1. FULL BOARD EVALUATION
Since 1995, the Board's Governance Committee has led annual evaluations of
Board performance. The evaluation process is designed to facilitate ongoing,
systematic examination of the Board's effectiveness and accountability, and to
identify opportunities for improving its operations and procedures.
In 1995 and 1997, evaluations were conducted to assess performance by the
Board as a whole in sixteen principal areas, and the results reported to
shareowners in the proxies for those years. The evaluation criteria measured
such aspects of Board performance as the following:
-- knowledge and understanding of the Company's vision and its operating
and strategic plans
-- involvement in major business policies and decisions
-- use of time for in-depth strategic business presentations and
discussions
-- oversight of the Company's annual capital and operating budgets, income
statement, balance sheet and cash flow
-- attention to performance of peer companies
-- oversight of the performance of the CEO and senior officers, and of
executive compensation relative to performance
-- oversight of planning for executive succession
-- quality of communication and participation in Board meetings
-- adequacy and timeliness of preparation of Board materials
13
<PAGE> 17
2. INDIVIDUAL DIRECTOR EVALUATION
In 1998, the Board's evaluation process focused on assessment of the
performance of its individual members. Each director completed a self-evaluation
form, developed by the Governance Committee, examining his or her effectiveness
against 35 criteria designed to measure performance in eight critical areas:
-- Independence and Integrity
-- Knowledge and Expertise
-- Stature
-- Accountability and Decisiveness
-- Participation and Input
-- Preparation
-- Availability
-- Teamwork
3. EVALUATION OF BOARD COMMITTEES
In 1999, the Board's evaluation process focused on assessment of the
procedures and performance of its Committees. Each director completed an
evaluation form that elicited numerical ratings of and written comments on the
structure of the Board's Committee system, the effectiveness of Committee
assignments and Committee chair assignments, the effectiveness of Committee
operations and decision-making, and the relationship between the Committees and
the Board.
From the evaluation forms, a composite report was prepared. The Chairman of
the Board and the Chairman of the Governance Committee then discussed the
findings and recommendations set forth in the report with each of the Committee
Chairmen. Members of management who regularly work with the Committees were also
asked to comment on the findings and recommendations. Finally, the Governance
Committee prepared a report to the Board that summarized the results of the
evaluation, identified proposed changes to Mission Statements of the respective
Committees, set forth areas for improvement, and recommended steps that could be
taken by the Committees and by management to enhance Committee performance.
TIMETABLE FOR EVALUATIONS
On a rotating basis, evaluations of Board performance focus on assessments
of (a) the Board as a whole, (b) the individual directors, and (c) the Board
Committees, with follow-up on the recommendations emerging from each step in the
program cycle in the year following its completion. In 2000, the directors will
evaluate the performance of the Board as a whole, while the Governance Committee
simultaneously oversees a follow-up assessment of the execution of the
recommendations to improve the Committee system that emerge from the 1999
process. In 2001 the individual director evaluation program will be completed,
while the Governance Committee follows up on recommendations as to the full
Board generated by the evaluation in 2000.
GOVERNANCE COMMITTEE
<TABLE>
<S> <C>
George Strawbridge, Jr., Chair Thomas W. Field, Jr.
Alva A. App Kent B. Foster
Bennett Dorrance Charles H. Mott
</TABLE>
14
<PAGE> 18
COMPENSATION OF EXECUTIVE OFFICERS
COMPENSATION AND ORGANIZATION COMMITTEE'S REPORT ON EXECUTIVE COMPENSATION
* Highlights of Compensation
The Compensation and Organization Committee believes that Campbell's
compensation programs are among the most results-driven and shareowner-sensitive
in the consumer packaged goods industry. Campbell's programs are designed to
deliver fixed compensation elements, such as salary and benefits, at industry
median levels, and incentive compensation from the median to the ninetieth
(90th) percentile based upon business results and stock price appreciation. When
Campbell's shareowners win -- through consistent growth in earnings and revenue,
creation of economic value and stock price appreciation -- Campbell's executives
win. If shareowners do not realize these gains, the total compensation of
Campbell's executives will be substantially below the industry median. If
performance thresholds are not achieved, payments under the short-term and
long-term incentive plans are zero.
We believe that our compensation strategy and programs have been important
factors in the Company's earnings growth, margin improvement, cash generation,
and total return to shareowners since 1990.
There are three unique and defining elements of Campbell's program:
(1) TIGHT LINK BETWEEN PAY AND MEASURED PERFORMANCE.
OBJECTIVITY. Our incentive payments are based on objective financial
performance measures designed to build shareowner wealth: sales,
earnings, and creation of economic value.
NO WINDFALLS. In the short term, holders of stock options may benefit
(or suffer) from stock market factors unrelated to their own
performance. We have therefore balanced our long-term incentives
between options and long-term performance-restricted stock (shares
that are automatically forfeited if performance goals are not met or
if an executive voluntarily resigns).
(2) TOUGH TARGETS.
Campbell's program emphasizes "stretch" and risk-bearing in the
following ways:
INDEPENDENT VALIDATION. All of Campbell's independent directors play
active roles in assessing the degree of "stretch" in management's
proposed performance goals. Throughout the 1990s, the Board-approved
annual operating plan has had an earnings goal set before the
beginning of each fiscal year to achieve growth rates in the top
quartile of the Company's Performance Peer Group, as projected by the
consensus of independent securities analysts. For fiscal 1999, this
peer group consisted of 15 food companies that include Campbell's key
competitors.
HIGH PORTION AT RISK. For the executive officers listed on page 20,
the portion of total pay that was at risk in fiscal 1999 ranged from
75% to more than 90%.
HIGH LEVERAGE. The rewards and risks of Campbell's programs are more
highly leveraged than those of peers. If the earnings goal is missed
by 10%, bonus payout is cut to half of the target, and if the goal is
missed by more than 10%, there is no bonus on the earnings portion. If
a business beats its earnings goal by 10%, the target bonus is
doubled.
WINNING IS ONLY IN RELATIVITY. Performance relative to peers receives
great emphasis in Campbell's compensation plans. Peer performance is a
key component in both the annual bonus and long-term performance
plans. Even the amount that the Company contributes to match
employees' contributions to the Company Savings Plan depends on
whether Earnings Per Share (EPS) growth ranks in the top quartile of
the Performance Peer Group.
Campbell has put a great deal of effort into ensuring a high
correlation between performance relativity and pay relativity.
Salaries are set at the median for the Compensation Peer Group, the 31
consumer products companies which are Campbell's main competitors in
recruiting talent. Bonuses are designed to bring total cash
compensation into the top quartile only if the
15
<PAGE> 19
operating plan commitment is delivered and EPS growth, measured at the
end of the year, actually ranks in the top quartile of the Performance
Peer Group.
(3) EXECUTIVES WALK IN SHAREOWNERS' SHOES.
Every executive must buy and hold an ownership stake in the Company
that is significant in comparison with his or her salary. The current
requirements and the requirements effective as of December 31, 2000,
which apply to the top 300 executives worldwide, are as follows:
<TABLE>
<CAPTION>
MULTIPLE OF
ANNUAL BASE SALARY
--------------------------------
EFFECTIVE
DECEMBER 31,
POSITION CURRENT 2000
-------- ----------- -----------------
<S> <C> <C>
Chief Executive Officer.............................. 3x 7x
Executive Vice President............................. 2x 5x
Senior Vice President................................ 2x 5x
Vice President....................................... 1x 3x
Other Executives..................................... .25x to .5x .25x to 1x
</TABLE>
Restricted shares and options, including vested stock options, are not
counted in calculating ownership. Performance-restricted shares of
Campbell stock make up a significant portion of every executive's
total compensation.
All shares used in executive compensation programs are shares which
were previously issued and outstanding and reacquired by the Company.
Stock options may not be repriced.
* Calculation of Annual Bonus
The following methodology determined bonus payouts for fiscal 1999:
I. ACTIONS BEFORE THE START OF THE FISCAL YEAR
(1) A target bonus was set for each participating executive. This dollar
amount was based upon a percentage of the midpoint of the salary range
for the executive's job and was calculated to deliver compensation
between median and top quartile in comparison with the Compensation
Peer Group.
(2) The Board of Directors reviewed and approved an Operating Plan which
set specific performance goals (which in 1999 were cash return on
assets (CROA), net sales, earnings and reductions in working capital)
for the Company as a whole and separately for its major business units.
(3) The Compensation and Organization Committee determined what portion of
each executive's bonus would depend on Company results (a minimum of
20%) and what portion would depend on the results of a business unit.
For the CEO, 100% of bonus depended on total Company results.
(4) The Committee determined that an additional amount of 30% of target
bonus should be paid if Campbell's EPS performance goal was met and the
Company placed in the Top Quartile of the Performance Peer Group in EPS
growth.
(5) The Committee determined that an additional amount of 30% to 60% of
target bonus should be paid if the volume/mix growth goal for the
Company as a whole was achieved or exceeded.
II. ACTIONS AFTER THE END OF THE FISCAL YEAR
(1) Financial statements were prepared for the Company and each business
unit.
(2) For each business unit and the Company, CROA was calculated and
compared to the Board-determined threshold. Business units that did not
meet their Operating Plan CROA threshold were not eligible for any
bonus based on unit performance. In fiscal 1999, the Company did not
achieve its CROA threshold.
16
<PAGE> 20
(3) Where the CROA threshold was satisfied, the major portion (60-70%) of
the bonus opportunity was determined by comparing earnings performance
to the Operating Plan earnings goal. If the earnings threshold was not
met, no bonus was paid based on the unit's earnings. By the terms of
the incentive plan, extraordinary events such as major restructurings
and accounting changes are excluded. In fiscal 1999 the Company's EPS
did not meet the threshold, and no bonus was paid for total Company
earnings performance.
(4) Sales performance, representing at least a 20% portion of bonus
opportunity (30% for most business units), was compared to the
Operating Plan sales goal. If the sales threshold was not met, the
sales portion of the target bonus was not paid. Above-plan sales
performance could result in above-target bonus payment only if the
earnings threshold was also met. In fiscal 1999, Company sales
performance did not meet the threshold, and no bonus was paid for total
Company sales performance.
(5) Working capital levels, representing a 10% portion of bonus
opportunity, were compared to the goal for reduction of working capital
in the Operating Plan. If the working capital reduction threshold was
not met, no bonus was paid for working capital reduction. In fiscal
1999, total Company reduction of working capital levels met the
threshold request for payment. Because the CROA threshold was not
achieved, no bonus was paid for total Company working capital
performance.
(6) Total Company volume/mix growth, representing an additional bonus
opportunity of up to 60% of target, was compared to the goal in the
Operating Plan. In fiscal 1999, total Company volume/mix growth did not
meet the threshold and no bonus was paid.
(7) Finally, Company earnings performance was compared to that of the
Performance Peer Group. By the terms of the program, if the Company
achieves its goal for EPS and the rate of annual growth in the
Company's EPS places it in the top quartile of the Performance Peer
Group, each bonus-eligible executive receives an additional 30% of
his/her bonus target. For purposes of this "top quartile" calculation,
extraordinary events are excluded. Companies that ranked in the bottom
quartile in EPS growth in the prior fiscal year are excluded from the
calculation because the purpose of this component of bonus opportunity
is to motivate consistent peer-beating results and to provide
compensation in the top quartile of the Compensation Peer Group if top
quartile performance is achieved. In fiscal 1999, there was no
opportunity for a top quartile award because the Company did not
achieve its EPS goal. In fiscal 2000, the Company must exceed its goal
for EPS by an amount set by the Compensation Committee and EPS growth
must be in the top quartile in order to earn this 30% supplementary
award.
M Long-Term Compensation (Restricted Performance Stock and Stock Options)
Half of executives' long-term compensation is delivered via restricted
performance shares. Grants are made every two years for overlapping three-year
performance periods. For performance years 1998-2000, eligibility for delivery
of shares at the end of a performance period depends on whether the Company
meets the minimum CROA set by the Board in the strategic plan for the
performance period. The number of shares actually delivered depends upon
cumulative EPS for the performance period. If the Company satisfies its CROA
threshold and delivers cumulative EPS beyond the goal in the strategic plan,
additional shares are awarded at time of earnout, up to a maximum of 150% of
target based on cumulative EPS performance. The Committee may adjust the
performance goals for the long-term plans for extraordinary events such as major
restructurings and accounting changes. For performance years 2000-2002 the
number of shares actually delivered depends upon cumulative economic profit
created for the performance period (80% of weighting) and the compound annual
growth rate of net sales during the performance period (20% of weighting). If
the Company delivers economic profit and net sales beyond the goals in the
strategic plan, additional shares are awarded at the time of earnout, up to a
maximum of 150% of target. For performance years 1998-2000 and 2000-2002 the top
quartile award is 25% for top quartile EPS growth and 25% for top quartile sales
growth, in addition to the earnout based strictly on Campbell performance, for a
maximum payout opportunity of 200% of target. Goals for both
17
<PAGE> 21
sales and EPS must be met in order for the 1998-2000 top quartile award to be
paid. The goal for cumulative economic profit must be met in order for the
2000-2002 top quartile award to be paid.
The other half of value delivered to executives under the Long-Term
Incentive Plan is in the form of stock options, awarded annually.
The guidelines for restricted performance share and stock option grants to
executives are designed to deliver long-term compensation at the 75th percentile
when compared to the Compensation Peer Group, provided the performance goals are
achieved.
** Policy on Deductibility of Compensation
Section 162(m) of the Internal Revenue Code limits the tax deduction to $1
million for compensation paid to the executive officers listed on page 20,
unless certain requirements are met. One of those requirements is that
compensation over $1 million must be based upon Company attainment of
performance goals approved by shareowners. The 1994 Long-Term Incentive Plan and
the Management Worldwide Incentive Plan, which were approved by shareowners in
1994, and which are recommended for reapproval this year, are designed to meet
these requirements. Minimal changes had to be made to these plans in 1994
because the Company's incentive plans were already designed to link pay to
Company performance. Before awards are paid the Compensation Committee or a
subcommittee thereof must certify the attainment of the applicable performance
goals. The Company believes that all compensation paid in respect of fiscal 1999
to the executive officers whose names are listed on page 20 is fully deductible.
The Committee's present intention is to comply with the requirements of Section
162(m) unless and until the Committee determines that compliance would not be in
the best interests of the Company and its shareowners.
** CEO Compensation and Evaluation
The determination of the Chief Executive Officer's salary, bonus and annual
grants of stock options and restricted performance shares followed all of the
policies and calculations set forth above for those components of all
executives' compensation.
The CEO's salary increase of 12.5% effective October 1, 1998, was based on
the Compensation Committee's evaluation of his and the Company's performance in
fiscal 1998, ended August 2, 1998. The Company's performance in fiscal 1998 was
measured against goals for CROA, EPS, sales and working capital. The goals for
CROA and EPS were exceeded. Company performance was also compared to the
performance of the Performance Peer Group based on CROA, sales, earnings,
working capital levels, cash margins and net margins. Other measures used to
evaluate the CEO were stock price performance, market share, and development of
sound strategic, operating and succession plans. No specific weighting was
assigned to these factors in determining the base salary increase.
Mr. Morrison earned no bonus in fiscal 1999 based entirely on the
quantitative criteria set forth on pages 16-17.
The CEO evaluation process requires that every independent director
complete a written assessment of the CEO's performance based on a formal
position description for the job of CEO, which defines responsibilities in each
of the following areas:
<TABLE>
<S> <C>
-- Management Development and Succession
-- Strategic Planning Planning
-- Leadership -- Human Resources
-- Financial Results -- Communication
-- Management of Operations -- Board Relations
</TABLE>
18
<PAGE> 22
Input is also obtained from other sources, including securities analysts,
key executives, employees, and shareowners. The results are summarized and the
full text of a written evaluation is discussed and approved by the Board. The
Chairman of the Compensation and Organization Committee presents the ratings and
evaluation comments both in person and in writing to the CEO, who then responds
to the full Board. This evaluation process was completed in July 1999 and the
results were considered in Dale Morrison's annual salary review in September
1999.
COMPENSATION AND ORGANIZATION COMMITTEE
<TABLE>
<S> <C>
Philip E. Lippincott, Chair Mary Alice D. Malone
Edmund M. Carpenter George Strawbridge, Jr.
Thomas W. Field, Jr. Charlotte C. Weber
Harvey Golub
</TABLE>
COMPENSATION AND ORGANIZATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mary Alice D. Malone owns more than 10% of the common stock of Vlasic Foods
International Inc. ("Vlasic") that was spun off from the Company in 1998. The
Company and Vlasic had certain business relationships in fiscal 1999 that are
disclosed on page 11.
19
<PAGE> 23
TABLE 1--SUMMARY COMPENSATION
The following table sets forth the cash compensation awarded, paid to, or
earned by the Company's Chief Executive Officer and the four other most highly
paid Executive Officers in fiscal years 1997, 1998 and 1999.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS
-----------------------------------------------
RESTRICTED SECURITIES
NAME AND FISCAL STOCK UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS(1) AWARDS(2) OPTIONS(#) COMPENSATION(3)
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
DALE F. MORRISON 1999 $883,333 0 $7,799,768 100,000 $ 20,833
President and Chief 1998 $800,000 $1,093,500 0 200,000 $ 56,805
Executive Officer 1997 $362,500 $ 252,323 $4,890,488 217,604 $ 18,117
- -------------------------------------------------------------------------------------------------------
F. MARTIN THRASHER (4) 1999 $350,000 $ 176,337 $2,495,345 54,000 $ 13,158
Senior Vice President $321,667 $ 454,840 0 30,750 $127,727
and 1998
President, North America 1997 $283,333 $ 159,536 $1,505,887 25,460 $ 13,286
Soup and Sauces Division
- -------------------------------------------------------------------------------------------------------
CRAIG W. RYDIN (5) 1999 $260,333 $ 188,500 $ 924,991 20,800 $ 23,326
Vice President and 1998 $210,333 $ 310,764 $ 120,982 14,000 $ 15,633
President, Campbell Away 1997 $196,000 $ 175,086 $ 326,788 10,880 $ 11,133
From Home Division
- -------------------------------------------------------------------------------------------------------
BASIL L. ANDERSON 1999 $445,000 0 $2,730,844 40,500 $ 11,125
Executive Vice President 1998 $420,000 $ 398,520 0 48,000 $ 24,556
and Chief Financial $360,833 $ 301,680 $1,502,331 108,802 $ 12,088
Officer 1997
- -------------------------------------------------------------------------------------------------------
ANDREW K. HUGHSON 1999 $272,500 $ 99,533 $ 624,445 14,400 $ 9,301
Vice President and 1998 $260,000 $ 151,490 $ 41,100 11,200 $ 12,345
President, International 1997 $230,000 $ 133,609 $ 351,470 11,642 $ 10,908
Grocery Asia/Pacific
- -------------------------------------------------------------------------------------------------------
</TABLE>
- ------------------
1. As explained on pages 15-17, the Company's annual bonus program has
components based on the performance of individual business units as well as
total Company performance. In fiscal 1999 no bonuses were paid based on total
Company performance (778 out of 1,032 eligible executives received no
bonuses). Certain business units achieved their goals and bonuses were paid
in fiscal 1999 based on that performance.
2. The Restricted Stock Awards listed in the above table include one award of
10,000 time-lapse restricted shares made to F. Martin Thrasher in fiscal
1997, valued at $414,063 based on the market price of Campbell shares on the
date of the grant. All other awards shown in the Restricted Stock Awards
column were restricted performance shares ("RPS") granted to executives
pursuant to the Long-Term Incentive Plan. The performance goals for RPS are
described on pages 17-18 above. Initial "target" grants of RPS are made in
the fiscal year prior to a three-year performance period. Except for
dividends, which are paid on all restricted shares regardless of Company
performance, initial grants of RPS are entirely at risk. The number of shares
delivered to an executive when the awards are paid out at the conclusion of
the performance period may range from 0% to 200% of the initial target award,
depending on Company performance.
The amounts shown in the above table with respect to RPS include three
components:
- Initial grants of RPS were made at the end of fiscal 1997 for the
performance period beginning in fiscal 1998 and concluding in fiscal
2000, and at the end of fiscal 1999 for the performance period beginning
in fiscal 2000 and concluding in fiscal 2002. Initial grants of RPS are
reported in the Restricted Stock Awards column of the table at 100% of
the initial target grants and are valued in the table based upon the
market price of Campbell shares at the time of the grants.
- If an executive was promoted during a performance period, an adjustment
was made to the initial grant of RPS at the time of the promotion. The
RPS awards to Messrs. Rydin and Hughson in fiscal 1998 were prorated
adjustments to their initial grants for the fiscal 1998-2000 performance
period, reflecting their promotions.
20
<PAGE> 24
- In fiscal 1997, shares were paid out to participants in the Long Term
Incentive Plan for the 1994-96 performance period. As a result of Company
performance exceeding the cumulative EPS goal for that period,
participants received a payout of 150% of their initial grants. In fiscal
1999, shares were paid out for the 1996-1998 performance period. As a
result of Company performance exceeding the cumulative EPS goal for that
period, participants received a payout of 166% of their initial grants.
The amounts listed in the Restricted Stock Awards column of the table for
fiscal years 1997 and 1999 include the value of shares paid out in those
years in excess of 100% of the initial target grants, as adjusted.
Accordingly, amounts listed for fiscal 1997 include the value of the
additional 50% of shares paid out in that year to any executive who
participated in the program for the 1994-1996 performance period, and
amounts listed for fiscal 1999 include the value of the additional 66% of
shares paid out in that year to participants in the program for the
1996-1998 performance period. In each case, the additional shares in
excess of 100% of the initial target grants are valued in the table based
upon the market price of Campbell shares at the end of the respective
performance periods.
The aggregate number of restricted performance stock or restricted
performance stock units held by the executives listed in the table, as of
the end of fiscal 1999, are set forth below. Shares are valued based on
the $44 closing price of Campbell shares on August 1, 1999.
<TABLE>
<CAPTION>
PERFORMANCE NUMBER OF
PERIOD SHARES* VALUE @ $44
----------- --------- -----------
<S> <C> <C> <C>
Dale F. Morrison...................... 1998-2000 62,577 $2,753,388
2000-2002 140,000 $6,160,000
F. Martin Thrasher**.................. 1998-2000 17,661 $ 777,084
2000-2002 40,000 $1,760,000
Craig W. Rydin........................ 1998-2000 8,599 $ 378,356
2000-2002 14,300 $ 629,200
Basil L. Anderson..................... 1998-2000 31,288 $1,376,672
2000-2002 40,000 $1,760,000
Andrew K. Hughson..................... 1998-2000 7,301 $ 321,244
2000-2002 10,000 $ 440,000
</TABLE>
- ---------------
* Represents initial grants of RPS for fiscal years 1998-2000 and
2000-2002. Payouts will be made in the fiscal year following the
performance period and may range from 0% to 200%, depending on Company
performance. In 1998, restricted shares were adjusted to take into
account the effect of the spinoff of Vlasic Foods International. Holders
of restricted shares did not receive shares of Vlasic at the time of the
spinoff, but instead received additional restricted shares.
** On August 1, 1999, Mr. Thrasher also held 4,172 time-lapse restricted
shares with a value of $183,568 at $44 per share.
3. "All other compensation" consists of Company contributions or allocation to
savings plans (tax-qualified and supplemental).
4. F. Martin Thrasher became President of North America Soup and Sauces Division
on July 1, 1999. He was appointed President of Europe/Canada in the beginning
of fiscal 1998 and, in addition to contributions to savings plans of $23,295,
his other compensation in fiscal 1998 included $104,440 for expenses related
to his relocation overseas.
5. Craig W. Rydin became President of Campbell Away From Home in fiscal 1999,
located in Camden, New Jersey. Previously he was President of Godiva located
in New York City. In addition to contributions to savings plans of $11,221,
his other compensation in fiscal 1999 included $12,105 for relocation
expenses.
21
<PAGE> 25
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
TABLE 2 -- OPTION GRANTS IN LAST FISCAL YEAR
- --------------------------------------------------------------------------------------------------------
GRANT DATE
INDIVIDUAL GRANTS VALUE(1)
- --------------------------------------------------------------------------------------------------------
% OF
NUMBER OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO EXERCISE GRANT
OPTIONS EMPLOYEES OR BASE DATE
GRANTED(2) IN FISCAL PRICE EXPIRATION PRESENT
NAME (#) YEAR ($/SH) DATE VALUE ($)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Dale F. Morrison 100,000 2.6% $42.53 6/24/09 $1,237,000
- --------------------------------------------------------------------------------------------------------
F. Martin Thrasher 54,000 1.4% $42.53 6/24/09 $ 667,980
- --------------------------------------------------------------------------------------------------------
Craig W. Rydin 20,800 0.5% $42.53 6/24/09 $ 257,296
- --------------------------------------------------------------------------------------------------------
Basil L. Anderson 40,500 1.0% $42.53 6/24/09 $ 500,985
- --------------------------------------------------------------------------------------------------------
Andrew K. Hughson 14,400 0.4% $42.53 6/24/09 $ 178,128
- --------------------------------------------------------------------------------------------------------
</TABLE>
- ------------------
(1) In accordance with Securities and Exchange Commission (SEC) rules, the
Black-Scholes option pricing model was chosen to estimate the grant date
present value of the options set forth in this table. The Company's use of
this model should not be construed as an endorsement of its accuracy at
valuing options. All stock option models require a prediction about the
future movement of the stock price. The following assumptions were made for
purposes of calculating Grant Date Present Value for the option grant
expiring on June 24, 2009: option term of 10 years, volatility of 22.8%
(calculated monthly over the three preceding calendar years), dividend yield
of 1.9%, forfeiture risk rate of 9.1%, and interest rate of 4.7% (ten year
Treasury note rate at January 2, 1999). The real value of the options in
this table depends upon the actual performance of the Company's stock during
the applicable period and upon when they are exercised.
(2) Options have a ten-year term and vest cumulatively over three years at the
rate of 30%, 60%, 100% respectively on the first three anniversaries
following the date of grant. All options vest immediately in the event of a
Change in Control.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------
TABLE 3 -- AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
- -----------------------------------------------------------------------------------------------
SECURITIES
UNDERLYING VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FY-END (#) FY-END ($)(2)
SHARES --------------------------------------------------------
ACQUIRED ON REALIZED EXER- UNEXER- EXER- UNEXER-
NAME EXERCISE (#) ($)(1) CISABLE CISABLE CISABLE CISABLE
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Dale F. Morrison 0 0 318,404 327,042 $2,254,336 $146,870
- -----------------------------------------------------------------------------------------------
F. Martin Thrasher 0 0 175,037 85,709 $2,835,955 $ 79,310
- -----------------------------------------------------------------------------------------------
Craig W. Rydin 13,279 $615,418 86,889 34,952 $1,741,799 $ 30,549
- -----------------------------------------------------------------------------------------------
Basil L. Anderson 0 0 297,285 117,621 $3,151,435 $ 59,482
- -----------------------------------------------------------------------------------------------
Andrew K. Hughson 0 0 31,235 26,897 $ 252,558 $ 21,149
- -----------------------------------------------------------------------------------------------
</TABLE>
- ------------------
(1) Value realized equals pretax market value of the stock on date of exercise,
less the exercise price, times the number of shares acquired. Shares may be
used to pay withholding taxes.
(2) Value of unexercised options equals fair market value of a share into which
the option could have been converted at August 1, 1999 (market price
$44.00), less exercise price, times the number of options outstanding.
22
<PAGE> 26
RETURN TO SHAREOWNERS* PERFORMANCE GRAPH
The following graph compares the cumulative total Shareowner return on the
Company's Capital Stock with the cumulative total return of the Standard &
Poor's Food Index (the "S&P Food Group") and the Standard & Poor's 500 Stock
Index (the "S&P 500"). Also shown below are the related compound annual growth
rates (CAGR). The graph assumes that $100 was invested on August 2, 1994, in
each of Campbell stock, the S&P Food Group and the S&P 500, and that all
dividends were reinvested.
[RETURN TO SHAREOWNERS PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
CAMPBELL S&P FOOD GROUP S&P 500
-------- -------------- -------
<S> <C> <C> <C>
1994 100 100 100
1995 130 129 126
1996 190 148 146
1997 296 221 221
1998 330 243 266
1999 273 231 319
CAGR 22.4% 18.2% 26.1%
</TABLE>
PENSION PLANS
Effective May 1, 1999, the present value of accrued benefits for executive
officers named on page 20 under the Company's regular and supplementary pension
plans was converted to an opening "account balance" to begin accruing benefits
under a cash balance formula. Under the cash balance formula, each participant
has an account, for record keeping purposes only, to which credits are allocated
each payroll period based upon a percentage of the participant's base salary
plus bonus paid in the current pay period. The applicable percentage is
determined by the age of the participant as of the beginning of the current
calendar year. If an individual participated in the Company's regular and
supplementary plans prior to May 1, 1999, and leaves the Company within fifteen
years of that date, such participant will receive the greater of the benefits as
calculated under the final average pay plan method in effect prior to May 1,
1999 or under the cash balance formula method.
23
<PAGE> 27
The following table illustrates the approximate annual pension that may
become payable to an employee in the higher salary classifications under the
Company's regular and supplementary final average pay pension plans.
<TABLE>
<CAPTION>
AVERAGE
COMPENSATION
IN HIGHEST
5 YEARS OF ESTIMATED ANNUAL PENSIONS
LAST 10 YEARS OF SERVICE
YEARS OF --------------------------------------------------------------
EMPLOYMENT 20 25 30 35 40
- ------------ ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
$ 600,000 $ 248,060 $ 252,700 $ 266,121 $ 281,301 $ 296,481
800,000 338,060 342,700 356,121 376,301 396,481
1,000,000 428,060 432,700 446,121 471,301 496,481
1,200,000 518,060 522,700 536,121 566,301 596,481
1,400,000 608,060 612,700 626,121 661,301 696,481
1,600,000 698,060 702,700 716,121 756,301 796,481
1,800,000 788,060 792,700 806,121 851,301 896,481
2,000,000 878,060 882,700 896,121 946,301 996,481
2,200,000 968,060 972,700 986,121 1,041,301 1,096,481
2,400,000 1,058,060 1,062,700 1,076,121 1,136,301 1,196,481
</TABLE>
Compensation covered for executive officers named in the table on page 20
is the same as the total salary and bonus shown in that table. These estimated
amounts assume retirement at age 65 (normal retirement age) with a straight-life
annuity without reduction for a survivor annuity or for optional benefits. They
are not subject to deduction for Social Security benefits or other offsets. The
years of service set forth below for the executive officers named in the table
on page 20 include additional years of service pursuant to supplemental pension
arrangements designed to attract executives from other employers in the middle
of their careers. Such arrangements are a necessary part of the recruitment and
retention package for senior executives in order to compensate them for pension
benefits that would have accrued had they remained at their previous employers.
As of the end of fiscal 1999, the full years of accrued service under the
pension plans for the individuals named in the compensation table on page 20
were as follows: Dale F. Morrison -- 10 years; F. Martin Thrasher -- 19 years;
Craig W. Rydin -- 30 years; Basil L. Anderson -- 8 years; and Andrew K.
Hughson -- 8 years.
TERMINATION ARRANGEMENTS
The Company has entered into Special Severance Protection Agreements
("Special Severance Agreements") with certain of the executive officers named on
page 20 as well as certain other executive officers. The Special Severance
Agreements provide severance pay and continuation of certain benefits should a
Change in Control occur. Entry into the Agreements was unanimously approved by
the independent members of the Board of Directors. In order to receive benefits
under the Special Severance Agreements, the executive's employment must be
terminated involuntarily, without cause, whether actual or "constructive,"
within two years following a Change in Control.
Generally, a "Change in Control" will be deemed to have occurred in any of
the following circumstances:
<TABLE>
<C> <S>
(i) the acquisition of 25% or more of the outstanding voting
stock of the Company by any person or entity, with certain
exceptions for Dorrance family members;
(ii) the persons serving as directors of the Company as of
January 25, 1990, and those replacements or additions
subsequently approved by a two-thirds vote of the Board,
cease to make up at least two-thirds of the Board;
</TABLE>
24
<PAGE> 28
<TABLE>
<C> <S>
(iii) a merger, consolidation or share exchange in which the
shareowners of the Company prior to the merger wind up
owning 80% or less of the surviving corporation; or
(iv) a complete liquidation or dissolution of the Company or
disposition of all or substantially all of the assets of the
Company.
</TABLE>
Under the Special Severance Agreements, severance pay would equal two and
one half years' base salary and bonus. Medical, life and disability benefits
would be provided at the expense of the Company for the lesser of (i) 30 months
or (ii) the number of months remaining until the executive's 65th birthday. The
Company would pay in a single payment an amount equal to the value of the
benefit the executive would have accrued under the Company's pension plans had
the executive remained in the employ of the Company for an additional 30 months
or until his or her 65th birthday, if earlier.
Upon a Change in Control, (a) all options outstanding on the date of such
Change in Control would become immediately and fully exercisable and (b) all
restrictions upon any restricted shares (other than "Performance Restricted
Shares" which are subject to performance related restrictions) would lapse
immediately and all such shares would become fully vested. An executive officer
would become vested in, and restrictions would lapse on, the greater of (i)
fifty percent (50%) of the Performance Restricted Shares or (ii) a pro rata
portion of such Performance Restricted Shares based on the portion of the
performance period that has elapsed to the date of the Change in Control.
During any fiscal year in which a Change in Control occurs, each
participant (a) whose employment is terminated prior to the end of such year or
(b) who is in the employ of the Company on the last day of such year would be
entitled to receive, within thirty (30) days thereafter, a cash payment equal to
the greater of (i) his or her target bonus award for such year or (ii) the
average of the awards paid or payable to him or her under the Management
Worldwide Incentive Plan for the two most recent fiscal years ended prior
thereto. Any amount to be paid to a participant who is not employed for the
entire fiscal year would be prorated. Such payment would be made whether or not
the Company has paid any cash dividend in the fiscal year.
ITEM 2
RATIFICATION OF APPOINTMENT OF AUDITORS
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THIS PROPOSAL
The proxy, unless otherwise directed thereon, will be voted for a
resolution ratifying action of the Board, upon the recommendation of its Audit
Committee, reappointing the firm of PricewaterhouseCoopers LLP ("PwC") Certified
Public Accountants, as independent accountants to make an audit of the accounts
of the Company for fiscal 2000. PwC has audited the Company's books for many
years. The names of the Directors serving on the Audit Committee are indicated
on page 9, under the heading "Board Committees and Meeting Attendance". The vote
required for ratification is a majority of shares voting. If the resolution is
rejected, or if PwC declines to act or becomes incapable of acting, or if their
employment is discontinued, the Board will appoint other accountants whose
continued employment after the 2000 Annual Meeting of the Shareowners will be
subject to ratification by the Shareowners.
Representatives of PwC will be at the 1999 Annual Meeting to make a
statement if they desire to do so and to answer questions.
For fiscal 1999 PwC also examined the separate financial statements of
certain of the Company's foreign subsidiaries and provided other audit services
to the Company in connection with SEC filings, review of periodic financial
statements and audits of certain employee benefit plans.
25
<PAGE> 29
ITEM 3
REAPPROVAL OF CAMPBELL SOUP COMPANY 1994 LONG-TERM INCENTIVE PLAN
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THIS PROPOSAL
The Campbell Soup Company 1994 Long-Term Incentive Plan ("Long-Term Plan")
was approved by shareowners at the 1994 Annual Meeting. The Long-Term Plan is
being submitted for reapproval for two main reasons. The first reason is to
increase the number of shares that may be issued under the Long-Term Plan from
25,000,000 to 50,000,000. The second reason is to meet the conditions of the
Internal Revenue Code so that compensation in excess of $1,000,000 paid to any
of the Company's five highest paid executive officers can be deducted for
federal income tax purposes.
When the Long-Term Plan was approved in 1994 for a ten-year period,
25,000,000 shares (as adjusted for the 2-for-1 stock split in 1997) were
allocated for stock option and restricted stock awards, with the anticipation
that these shares would cover grants made during the first five years of the
ten-year period. Grants of stock options and restricted stock have been made
that amount to approximately 19,500,000 shares and there are approximately
5,500,000 shares remaining under the initial authorization. To allow the
Committee to continue awards of stock options and restricted stock over the next
five years, an increase in the number of authorized shares is required. The
amendment would authorize the issuance of an additional 25,000,000 shares, or
approximately 6% of the Company's outstanding shares, under the Long-Term Plan.
Other major corporations generally allocate at any given time approximately 10%
to 12% of their outstanding shares to their executive stock programs and request
new share authorizations every three to five years. The Company's outstanding
shares at September 20, 1999, were 427,836,506.
The Long-Term Plan currently provides that shares issued for options and
restricted stock awards may come only from treasury shares. Such a requirement
results in the need to maintain a sufficient number of treasury shares to
provide for outstanding options and restricted stock grants. As of the end of
fiscal 1999, there were approximately 113,000,000 shares held by the Company in
its treasury and approximately 21,000,000 options and restricted shares
outstanding. The use of treasury shares for options and restricted shares may
help to maintain the stability of proportionate ownership interests in the
Company and prevent dilution of existing shareowners' interests. The use of
treasury shares exclusively eliminates the ability of the Company to use
authorized but unissued shares, a less costly vehicle for issuing shares, to
satisfy options and to grant restricted stock. Since 1984, the Company has not
used authorized but unissued shares to satisfy options or to grant restricted
shares.
The Board recommends the reapproval of the Long-Term Incentive Plan. A
majority of the votes cast at the meeting is required for approval. Except as
otherwise specified in the proxy, proxies will be voted for approval. The
Long-Term Plan is designed to motivate and reward key employees to attain and
surpass long-range performance goals, and to compete with other major
corporations in securing and retaining key employees.
A summary of the material features of the Long-Term Plan appears below. The
full text of the Long-Term Plan is set forth in Appendix A and should be
referred to for a complete description of its provisions.
* Effective Date and Expiration.
The Long-Term Plan became effective on November 17, 1994, and will
terminate on November 17, 2004. No award may be made under the Long-Term Plan
after its expiration date, but awards made prior thereto may extend beyond that
date.
* Administration.
The Long-Term Plan is administered by the Compensation and Organization
Committee of the Board of Directors which consists entirely of outside directors
as defined for purposes of Section 162(m) of the Internal Revenue Code. The
Committee has full authority to interpret the Long-Term Plan and to establish
26
<PAGE> 30
rules for its administration. The Committee may, in its discretion, accelerate
the date on which an option or stock appreciation right may be exercised, the
date of termination of restrictions applicable to a restricted stock award, or
the end of a performance period under a performance unit award, if the Committee
determines that to do so would be in the best interests of the Company and the
participants in the Long-Term Plan.
* Eligibility for Awards.
Awards can be made to key employees who can be any management salaried
employee. The current eligible group consists of approximately 1,000 persons. An
award to any key employee who also serves as a director must be approved by the
Board of Directors. Non-employee directors are eligible to receive awards.
* Determination of Amount and Form of Award.
The amount of individual awards to key employees will be determined by the
Committee, subject to the limitations of the Long-Term Plan. In determining the
amount and form of an award, consideration will be given to the functions and
responsibilities of the key employee, his or her potential contributions to the
success of the Company, and other factors deemed relevant by the Committee.
* Limitations on Awards.
The Long-Term Plan provides that over its ten-year term, stock options (and
related stock appreciation rights) and restricted and unrestricted stock grants
for not more than 50,000,000 shares of Campbell Capital Stock may be issued.
Notwithstanding the foregoing, after November 18, 1999, awards consisting of (1)
performance units that are measured based on the value of Campbell Capital
Stock, (2) restricted stock and (3) unrestricted stock shall not exceed the
aggregate of (x) 25% of the 25,000,000 shares authorized by Shareowners on
November 18, 1999 and (y) 25% of the 5,500,000 shares remaining available for
grant as of November 18, 1999 that were authorized by Shareowners on November
17, 1994. Campbell Capital Stock closed at $41.94 on September 20, 1999, on the
New York Stock Exchange composite tape. A maximum of five million stock options
may be issued in one year to any one participant. A maximum of $5 million for
each year in a performance period or restriction period may be awarded in the
form of Restricted Stock or Performance Units to any one participant.
* Stock Options.
The Committee can grant nonqualified options and options qualifying as
incentive stock options under the Internal Revenue Code of 1986, as amended. The
term of an option cannot exceed ten years from the date of grant. The option
price must be not less than the fair market value of a share of Campbell Capital
Stock on the date of grant. Stock options may not be repriced.
* Stock Appreciation Rights ("SAR").
The Committee can grant a SAR in connection with a stock option granted
under the Plan or a SAR unrelated to any option. If a grantee exercises a SAR,
the grantee would receive an amount equal to the excess of the fair market value
of the shares with respect to which the SAR is being exercised over the option
price of the shares. Payment would be in cash, in shares or a combination of the
two as the Committee determines.
* Restricted Performance Share Awards.
The Committee can also issue or transfer shares of Campbell Capital Stock
to a participant under a restricted performance share award. Awards are subject
to certain conditions and restrictions during a specific period of time, such as
the grantee remaining in the employment of the Company and/or the attainment by
the Company of certain performance goals (see pages 17-18 of the Compensation
Committee Report for the performance goals used under the Long-Term Plan). The
shares cannot be
27
<PAGE> 31
transferred by the grantee prior to the termination of that period. The grantee
is, however, entitled to vote the shares and in most cases is entitled to
receive the dividends currently.
* Performance Unit Awards.
The Committee can grant performance unit awards payable in cash or stock at
the end of a specified performance period. Payment will be contingent upon
achieving performance goals by the end of the performance period. The Committee
will determine the length of an award period, the maximum payment value of an
award, and the minimum performance goals required before payment will be made.
* Director Compensation.
In 1995, the shareowners approved an amendment to the Long-Term Plan
providing for the award of 2,400 Campbell shares and 2,000 stock options to each
Campbell Director on an annual basis beginning on January 1, 1996. A description
of the Company's Director compensation program for fiscal 1999 is set forth on
page 8. This program was designed to deliver compensation at the median of the
Performance Peer Group (15 food companies that include Campbell's top
competitors) with the opportunity for increased pay depending on total return
delivered to shareowners. The Board has reviewed competitive data and believes
the annual value of the current compensation package of approximately $160,000
for calendar 1999 (based on a $44 stock price) is high. The Board has approved a
new compensation package designed to meet two key criteria.
1. Deliver annual compensation that is at the median of the Performance
Peer Group; and
2. Deliver the compensation in the following proportions:
-- 50% Stock options (based on the Black-Scholes valuation model and the
stock price on December 31 of each year)
-- 30% Campbell Capital Stock (based on the closing price on December 31
of each year)
-- 20% Cash
For calendar year 2000, the Board determined that the median compensation
target will be $113,000. The Board believes that setting compensation at a fixed
dollar amount and paying a higher proportion of compensation in stock options
will link compensation with returns to shareowners more closely than the current
program.
In order to implement this new compensation package, the Board recommends
that Article VII of the Long-Term Plan be amended to give the Board the
discretion to set the number of options and Campbell Capital Stock that are
awarded to Directors each year.
* Amendment.
The Board of Directors can amend, suspend or terminate the Long-Term Plan,
but cannot, without the Shareowners' approval, do any of the following:
-- materially increase the benefits accruing to participants;
-- materially modify the requirements for eligibility;
-- extend the term of the Long-Term Plan; or
-- increase the number of shares of Campbell Capital Stock which may be
issued under the Long-Term Plan (except in the case of recapitalization,
stock split, or other changes in the corporate structure in which event
the Committee may make appropriate adjustments).
28
<PAGE> 32
* Federal Income Tax Consequences.
Stock Options. The grant of an incentive stock option, a nonqualified
stock option or a SAR, does not result in income for the grantee or in a
deduction for the Company. The exercise of a nonqualified stock option does
result in ordinary income for the optionee and a deduction for the Company
measured by the difference between the option price and the fair market value of
the shares received at the time of exercise. Income tax withholding is required.
Neither the grant nor the exercise of an incentive stock option results in
taxable income for the grantee. The excess of the market value on the exercise
date over the option price of the shares, however, is an "item of adjustment"
for alternative minimum tax purposes. When a grantee disposes of shares acquired
by exercise of an incentive stock option, the grantee's gain (the difference
between the sale proceeds and the price paid by the grantee for the shares) upon
the disposition will be taxed as capital gain provided the grantee (i) does not
dispose of the shares within two years after the date of grant nor within one
year after the transfer of shares upon exercise, and (ii) exercises the option
while an employee of the company or a subsidiary or within three months after
termination of employment for reasons other than death or disability. If the
shares are disposed of before the expiration of either period, the grantee
generally will realize ordinary income in the year of the disqualifying
disposition.
* Additional Information.
If a participant elects to defer payment of compensation, the value of the
amount deferred at the time of distribution will be measured as determined by
the Committee. The provisions in the event of a Change in Control are described
on pages 24-25. The awards made in the form of restricted performance shares and
stock options under the Long-Term Plan during the last three fiscal years to the
five highest paid executives are described on pages 20-22.
ITEM 4
REAPPROVAL OF CAMPBELL SOUP COMPANY
MANAGEMENT WORLDWIDE INCENTIVE PLAN
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THIS PROPOSAL
The Campbell Soup Company Management Worldwide Incentive Plan ("WIN Plan"),
which is the annual bonus program, has been in effect for 42 years. The
Shareowners first approved the WIN Plan at the 1957 Annual Meeting, and most
recently in amended form at the 1994 Annual Meeting. The WIN Plan must be
resubmitted to the Shareowners for approval at least once every five years. In
accordance with that provision, the WIN Plan (including certain amendments
adopted by the Board and described below) is being submitted at the 1999 Annual
Meeting for reapproval by a majority of the votes cast at the meeting. Except as
otherwise specified in the proxy, proxies will be voted for approval. A
description follows of the present WIN Plan and the amendments, together with
certain related information. The full text of the WIN Plan is set forth in
Appendix B and should be referred to for a complete description of its terms and
conditions.
* Purpose.
The purpose of the WIN Plan is to attract, motivate and retain high caliber
employees and to provide meaningful individual and group incentives within the
Company and its subsidiaries. It gives the Compensation and Organization
Committee ("Committee") of the Board of Directors discretion to determine the
aggregate amount of money to be used for awards based upon competitive
compensation practices and such measures of the Company's performance as the
Committee selects from time to time. Approximately 1,050 employees are eligible
to receive incentive compensation under the WIN Plan. The bonuses paid during
the last three years to the five highest paid executive officers are set forth
on page 20. The Committee and the Board are prohibited from making any awards
for a fiscal year in which no cash dividend is paid on Campbell Capital Stock,
except in the event of a Change in Control as
29
<PAGE> 33
described on pages 24-25. Individual awards are determined annually by the
Committee in accordance with performance goals established by the Committee at
the beginning of the fiscal year. The performance goals used for fiscal 1999 are
described on pages 16-17.
* Amendments.
The Board may amend, suspend or terminate the WIN Plan but it may not
adversely affect awards previously made.
The proposed amendments that have been approved by the Board are designed
to (1) broaden the definition of performance goals to include other value-based
performance measures, such as economic profit; (2) increase the allowable
maximum annual payment from $3 million to $5 million; (3) provide the Committee
the discretion to convert bonus awards into stock options or restricted stock
under the Long-Term Plan; and (4) eliminate unneeded provisions regarding
deferral of bonus awards.
SUBMISSION OF SHAREOWNER PROPOSALS
Under Rule 14a-8(e) of the Securities and Exchange Commission, shareowner
proposals intended for inclusion in next year's proxy statement must be
submitted in writing to the Company to the Corporate Secretary at Campbell
Place, Camden, New Jersey 08103-1799, and must be received by June 13, 2000.
Any shareowner proposal for next year's annual meeting submitted after
August 28, 2000, will not be considered filed on a timely basis with the Company
under SEC Rule 14a-4(c) (1). For proposals that are not timely filed, the
Company retains discretion to vote proxies it receives. For proposals that are
timely filed, the Company retains discretion to vote proxies it receives
provided 1) the Company includes in its proxy statement advice on the nature of
the proposal and how it intends to exercise its voting discretion; and 2) the
proponent does not issue a proxy statement.
DIRECTORS AND EXECUTIVE OFFICERS STOCK OWNERSHIP REPORTS
The federal securities laws require the Company's Directors and Executive
Officers, and persons who own more than ten percent of the Company's capital
stock, to file with the Securities and Exchange Commission and the New York
Stock Exchange initial reports of ownership and reports of changes in ownership
of any securities of the Company.
To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended August 1, 1999, all the
Company's Executive Officers, Directors and greater-than-ten-percent beneficial
owners made all required filings.
OTHER MATTERS
The Board of Directors knows of no other matters to be presented for action
at the meeting. If other matters come before the meeting, it is the intention of
the Directors' proxy to vote on such matters in accordance with his best
judgment.
PROXIES AND VOTING AT THE MEETING
This statement and the accompanying proxy card are being mailed on or about
October 8, 1999, for solicitation of proxies by the Board of Directors for the
Annual Meeting of Shareowners of Campbell Soup Company called to be held on
November 18, 1999. The mailing address of the Company's World Headquarters is
Campbell Place, Camden, New Jersey 08103-1799.
30
<PAGE> 34
Proxies marked as abstaining (including proxies containing broker
non-votes) on any matter to be acted upon by Shareowners will be treated as
present at the meeting for purposes of determining a quorum but will not be
counted as votes cast on such matters.
This solicitation of proxies is made on behalf of the Board of Directors of
the Company with authorization of the Board, and the Company will bear the cost.
Copies of proxy solicitation material will be mailed to Shareowners, and
employees of the Company may communicate with Shareowners to solicit their
proxies. Brokers, banks and others holding stock in their names, or in names of
nominees, may request and forward copies of the proxy solicitation material to
beneficial owners and seek authority for execution of proxies, and the Company
will reimburse them for their expenses in so doing at the rates approved by the
New York Stock Exchange.
When a proxy is returned properly dated and signed, the shares represented
thereby, including any shares held under the Company's Dividend Reinvestment
Plan, will be voted by the person named as the Directors' proxy in accordance
with each Shareowner's directions. Proxies will also be considered to be
confidential voting instructions to the applicable Trustee with respect to
shares held in accounts under the Campbell Soup Company Savings and 401(k) Plan
for Salaried Employees, the Campbell Soup Company Savings and 401(k) Plan for
Hourly-Paid Employees, and the Campbell Soup Company Ltd Employee Savings and
Stock Bonus Plan. If participants in these Plans are also Shareowners of record
under the same account information, they will receive a single proxy which
represents all shares. If the account information is different, then the
participants will receive separate proxies.
Shareowners of record and participants in savings plans may cast their vote
by:
1) using the toll-free phone number listed on the proxy solicitation/voting
instruction card;
2) using the Internet and voting at the web site listed on the proxy card;
or
3) signing, dating and mailing the proxy card in the enclosed postage paid
envelope.
The telephone and Internet voting procedures are designed to authenticate
votes cast by use of a personal identification number. The procedure allows
shareowners to appoint a proxy and the savings plan participants to instruct a
plan fiduciary to vote their shares and to confirm their instructions have been
properly recorded. Specific instructions to be followed are set forth on the
enclosed proxy solicitation/voting instruction card.
Shareowners are urged to specify their choices by marking the appropriate
boxes on the enclosed proxy card. If a proxy card is dated, signed and returned
without specifying choices, the shares will be voted as recommended by the
Directors (or, in the case of participants in the Plans referred to above, may
be voted at the discretion of the applicable Trustee). This year shareowners who
own shares directly in their own name, may vote their shares by telephone or via
the Internet. Please refer to the specific instructions on the enclosed proxy
card.
A Shareowner giving a proxy may revoke it by notifying the Corporate
Secretary in writing any time before it is voted. If a Shareowner wishes to give
a proxy to someone other than the Directors' proxy, all three names appearing on
the enclosed proxy may be crossed out and the name of another person inserted.
The signed proxy card must be presented at the meeting by the person
representing the Shareowner.
Each Shareowner who plans to attend the meeting in person is requested to
so indicate in the space provided on the proxy card. The Company will then be
able to mail an admission card to the Shareowner in advance of the meeting.
Shareowners who do not have admission cards will need to register at the door.
31
<PAGE> 35
INFORMATION ABOUT ATTENDING THE MEETING
The Annual Meeting of Shareowners will be held this year at the Civic
Center, Paris, Texas, which is approximately 5 miles from the Company's soup
plant in Paris, Texas. A map showing the meeting location appears at the back of
this booklet.
To obtain an admission ticket by mail in advance and avoid registration
lines at the door, simply indicate that you plan to attend the meeting by
marking the appropriate box on the proxy card and return it in the envelope
provided. If you do not wish to send the proxy card, you may obtain an admission
card by sending a written request in the envelope. Shareowners who do not have
admission cards will need to register at the door.
IF YOU DO NOT OWN SHARES IN YOUR OWN NAME, YOU SHOULD HAVE YOUR BROKER OR
AGENT IN WHOSE NAME THE SHARES ARE REGISTERED CALL (856) 342-6122, FAX (856)
342-3889, OR WRITE TO THE OFFICE OF THE CORPORATE SECRETARY AT CAMPBELL PLACE,
CAMDEN, NJ, 08103-1799 TO REQUEST A TICKET BEFORE NOVEMBER 3, 1999. OTHERWISE
YOU MUST BRING PROOF OF OWNERSHIP (E.G. BROKER'S STATEMENT) IN ORDER TO BE
ADMITTED DURING THE DAY OF THE MEETING.
We cannot issue admission tickets to guests of Shareowners because there is
only enough seating capacity for Shareowners who attend the meeting. Please note
that the doors to the meeting room at the Civic Center in Paris, Texas, will not
be open for admission until 10:00 a.m.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AND VOTED AT THE MEETING.
PLEASE FILL OUT, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY CARD OR VOTE BY
PHONE OR VIA THE INTERNET AS SOON AS POSSIBLE, WHETHER OR NOT YOU PLAN TO ATTEND
THE MEETING.
Camden, New Jersey
October 8, 1999
By order of the Board of Directors,
/s/ JOHN J. FUREY
John J. Furey
Corporate Secretary
32
<PAGE> 36
- --------------------------------------------------------------------------------
CAMPBELL SOUP COMPANY
------------------------
1994 LONG-TERM INCENTIVE PLAN
------------------------
As amended: November 18, 1999
- --------------------------------------------------------------------------------
Appendix A
<PAGE> 37
CAMPBELL SOUP COMPANY
1994 LONG-TERM INCENTIVE PLAN
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE PAGE
- ------- ----
<S> <C> <C>
I. Purpose and Effective Date.................................. A-1
II. Definitions................................................. A-1
III. Administration.............................................. A-3
IV. Awards...................................................... A-3
V. Stock Options and Stock Appreciation Rights................. A-4
VI. Restricted Stock............................................ A-8
VII. Awards for Non-Employee Directors........................... A-8
VIII. Unrestricted Campbell Stock Awards for Key Employees........ A-9
IX. Award of Performance Units.................................. A-9
X. Deferral of Payments........................................ A-10
XI. Miscellaneous Provisions.................................... A-10
XII. Change in Control of the Company............................ A-11
</TABLE>
<PAGE> 38
ARTICLE I
PURPOSE AND EFFECTIVE DATE
sec.1.1 PURPOSE. The purpose of the Plan is to provide financial
incentives for selected Key Employees of the Campbell Group and for the
non-employee Directors of the Company, thereby promoting the long-term growth
and financial success of the Campbell Group by (1) attracting and retaining
employees and Directors of outstanding ability, (2) strengthening the Campbell
Group's capability to develop, maintain, and direct a competent management team,
(3) providing an effective means for selected Key Employees and non-employee
Directors to acquire and maintain ownership of Campbell Stock, (4) motivating
Key Employees to achieve long-range Performance Goals and objectives, and (5)
providing incentive compensation opportunities competitive with those of other
major corporations.
sec.1.2 EFFECTIVE DATE AND EXPIRATION OF PLAN. The Plan was approved at
the 1994 annual meeting of shareowners of the Company and became effective on
November 17, 1994. Unless earlier terminated by the Board pursuant to Section
11.3, the Plan shall terminate on the tenth anniversary of its Effective Date.
No Award shall be made pursuant to the Plan after its termination date, but
Awards made prior to the termination date may extend beyond that date.
ARTICLE II
DEFINITIONS
The following words and phrases, as used in the Plan, shall have these
meanings:
sec.2.1 "AWARD" means, individually or collectively, any Option, SAR,
Restricted Stock, unrestricted Campbell stock or Performance Unit Award.
sec.2.2 "BOARD" means the Board of Directors of the Company.
sec.2.3 "CAMPBELL GROUP" means the Company and all of its Subsidiaries on
and after the Effective Date.
sec.2.4 "CAMPBELL STOCK" means Capital Stock of the Company.
sec.2.5 "CAPITAL AND INCOME RETAINED IN THE BUSINESS" means capital and
income, retained in the business of the Campbell Group as reported to the
Company on a consolidated basis by its independent public accountants.
sec.2.6 "CAUSE" means the termination of a Participant's employment by
reason of his or her (1) engaging in gross misconduct that is injurious to the
Campbell Group, monetarily or otherwise, (2) misappropriation of funds, (3)
willful misrepresentation to the directors or officers of the Campbell Group,
(4) gross negligence in the performance of the Participant's duties having an
adverse effect on the business, operations, assets, properties or financial
condition of the Campbell Group, (5) conviction of a crime involving moral
turpitude, or (6) entering into competition with the Campbell Group. The
determination of whether a Participant's employment was terminated for Cause
shall be made by the Company in its sole discretion.
sec.2.7 "CODE" means the Internal Revenue Code of 1986, as amended.
sec.2.8 "COMMITTEE" means the Compensation and Organization Committee of
the Board. All members of the Committee shall be "Outside Directors," as defined
or interpreted for purposes of Section 162(m) of the Code, and "Non-Employee
Directors," within the meaning of Rule 16b-3 under the Securities Exchange Act
of 1934 (the "1934 Act").
sec.2.9 "COMPANY" means Campbell Soup Company and its successors and
assigns.
sec.2.10 "DEFERRED ACCOUNT" means an account established for a Participant
under Section 10.1.
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sec.2.11 "DIRECTOR" means a member of the Board of Directors of the
Company.
sec.2.12 "EFFECTIVE DATE" means November 17, 1994.
sec.2.13 "FAIR MARKET VALUE" means, as of any specified date, an amount
equal to the mean between the reported high and low prices of Campbell Stock on
the New York Stock Exchange composite tape on the specified date.
sec.2.14 "FISCAL YEAR" means the fiscal year of the Company, which is the
52- or 53-week period ending on the Sunday closest to July 31.
sec.2.15 "INCENTIVE STOCK OPTION" means an option within the meaning of
Section 422 of the Code.
sec.2.16 "INCOME BEFORE TAXES ON INCOME" means income before taxes on
income of the Campbell Group as reported to the Company on a consolidated basis
by its independent public accountants.
sec.2.17 "KEY EMPLOYEE" means a salaried employee of the Campbell Group
who is in a management position.
sec.2.18 "NONQUALIFIED STOCK OPTION" means an Option granted under the
Plan other than an Incentive Stock Option.
sec.2.19 "OPTION" means either a Nonqualified Stock Option or an Incentive
Stock option to purchase Campbell Stock.
sec.2.20 "OPTION PRICE" means the price at which Campbell Stock may be
purchased under an Option as provided in Section 5.4 or in the case of a SAR
granted under Section 5.8 the Fair Market Value of Campbell Stock on the date
the SAR is awarded.
sec.2.21 "PARTICIPANT" means a Key Employee or a non-employee Director to
whom an Award has been made under the Plan or a Transferee.
sec.2.22 "PERFORMANCE GOALS" means goals established by the Committee
pursuant to Section 4.5.
sec.2.23 "PERFORMANCE PERIOD" means a period of time over which
performance is measured.
sec.2.24 "PERFORMANCE UNIT" means the unit of measure determined under
Article IX by which is expressed the value of a Performance Unit Award.
sec.2.25 "PERFORMANCE UNIT AWARD" means an Award granted under Article IX.
sec.2.26 "PERSONAL REPRESENTATIVE" means the person or persons who, upon
the death, disability, or incompetency of a Participant, shall have acquired, by
will or by the laws of descent and distribution or by other legal proceedings,
the right to exercise an Option or the right to any Restricted Stock Award or
Performance Unit Award theretofore granted or made to such Participant.
sec.2.27 "PLAN" means Campbell Soup Company 1994 Long-Term Incentive Plan.
sec.2.28 "RESTRICTED PERFORMANCE STOCK" means Campbell Stock subject to
Performance Goals provided in Section 4.5.
sec.2.29 "RESTRICTED STOCK" means Campbell Stock subject to the terms and
conditions provided in Article VI and including Restricted Performance Stock.
sec.2.30 "RESTRICTED STOCK AWARD" means an Award granted under Article VI.
sec.2.31 "RESTRICTION PERIOD" means a period of time determined under
Section 6.2 during which Restricted Stock is subject to the terms and conditions
provided in Section 6.3.
sec.2.32 "SAR" means a stock appreciation right granted under Section 5.8.
sec.2.33 "STATEMENT" means a written confirmation of an Award under the
Plan furnished to the Participant.
A-2
<PAGE> 40
sec.2.34 "SUBSIDIARY" means a corporation, domestic or foreign, the
majority of the voting stock of which is owned directly or indirectly by the
Company.
sec.2.35 "TRANSFEREE" means a person to whom a Key Employee or
non-employee Director has transferred his or her rights under the Plan in
accordance with procedures and guidelines adopted by the Company.
ARTICLE III
ADMINISTRATION
sec.3.1 COMMITTEE TO ADMINISTER. The Plan shall be administered by the
Committee. The Committee shall have full power and authority to interpret and
administer the Plan and to establish and amend rules and regulations for its
administration. The Committee's decisions shall be final and conclusive with
respect to the interpretation of the Plan and any Award made under it.
A majority of the members of the Committee shall constitute a quorum for
the conduct of business at any meeting. The Committee shall act by majority vote
of the members present at a duly convened meeting, which may include a meeting
by conference telephone call held in accordance with applicable law. Action may
be taken without a meeting if written consent thereto is given in accordance
with applicable law.
sec.3.2 POWERS OF COMMITTEE.
(a) Subject to the provisions of the Plan, the Committee shall have
authority, in its discretion, to determine those Key Employees who shall receive
an Award, the time or times when such Award shall be made, the vesting schedule,
if any, for the Award and the type of Award to be granted, whether an Incentive
Stock Option or a Nonqualified Stock Option shall be granted, the number of
shares to be subject to each Option and Restricted Stock Award, and the value of
each Performance Unit.
(b) An Option, a SAR, a Restricted Stock Award, an unrestricted Campbell
Stock Award, or a Performance Unit Award may be granted by the Committee to a
Key Employee who is a Director of the Company only if approved by the Board.
(c) The Committee shall determine and set forth in an Award Statement the
terms of each Award, including such terms, restrictions, and provisions as shall
be necessary to cause certain options to qualify as Incentive Stock Options. The
Committee may correct any defect or supply any omission or reconcile any
inconsistency in the Plan or in any Statement relating to an Award, in such
manner and to the extent the Committee shall determine in order to carry out the
purposes of the Plan. The Committee may, in its discretion, accelerate (i) the
date on which any Option or SAR may be exercised, (ii) the date of termination
of the restrictions applicable to a Restricted Stock Award, or (iii) the end of
a Performance Period under a Performance Unit Award, if the Committee determines
that to do so will be in the best interests of the Company and the Participants
in the Plan.
ARTICLE IV
AWARDS
sec.4.1 AWARDS. Awards under the Plan shall consist of Incentive Stock
Options, Nonqualified Stock Options, SARs, Restricted Stock, unrestricted
Campbell Stock and Performance Units. All Awards shall be subject to the terms
and conditions of the Plan and to such other terms and conditions consistent
with the Plan as the Committee deems appropriate. Awards under a particular
section of the Plan need not be uniform and Awards under two or more sections
may be combined in one Statement. Any combination of Awards may be granted at
one time and on more than one occasion to the same Key Employee. Awards of
Performance Units and Restricted Performance Stock shall be earned solely upon
attainment of Performance Goals and the Committee shall have no discretion to
increase such Awards.
A-3
<PAGE> 41
sec.4.2 ELIGIBILITY FOR AWARDS. An Award may be made to any Key Employee
selected by the Committee. In making this selection and in determining the form
and amount of the Award, the Committee may give consideration to the functions
and responsibilities of the respective Key Employee, his or her present and
potential contributions to the success of the Campbell Group, the value of his
or her services to the Campbell Group, and such other factors deemed relevant by
the Committee. Non-employee Directors are eligible to receive Awards pursuant to
Article VII.
sec.4.3 SHARES AVAILABLE UNDER THE PLAN. The Campbell Stock to be offered
under the Plan pursuant to Options, SARs, Performance Unit Awards, and
Restricted Stock and unrestricted Campbell Stock Awards must be Campbell Stock
previously issued and outstanding and reacquired by the Company. Subject to
adjustment under Section 11.2, no more than 50,000,000 shares of Campbell Stock
shall be issuable upon exercise of Options, SARs, or pursuant to Performance
Unit Awards, Restricted Stock or unrestricted Campbell Stock Awards granted
under the Plan. Any shares of Campbell Stock (1) tendered in payment of the
Option Price of Options; (2) subject to an Option which for any reason is
cancelled (excluding shares subject to an Option cancelled upon the exercise of
a related SAR) or terminated without having been exercised; or (3) any shares of
Restricted Stock which are forfeited, shall again be available for Awards under
the Plan. Shares subject to an Option cancelled upon the exercise of a SAR shall
not again be available for Awards under the Plan. After November 18, 1999,
Awards consisting of (1) Performance Units that are measured based on the Fair
Market Value of one share of Campbell Stock, (2) Restricted Stock, and (3)
unrestricted Campbell Stock shall not exceed the aggregate of (x) 25% of the
25,000,000 shares authorized by Shareowners on November 18, 1999 and (y) 25% of
the 5,500,000 shares remaining available for grant as of November 18, 1999 that
were authorized by Shareowners on November 17, 1994.
sec.4.4 LIMITATION ON AWARDS. The maximum aggregate dollar value of
Restricted Stock and Performance Units awarded to any Key Employee with respect
to a Performance Period or Restriction Period may not exceed $5 million for each
fiscal year included in such Performance Period or Restriction Period. The
maximum number of shares for which Options may be granted to any Participant in
any one fiscal year shall not exceed five million.
sec.4.5 GENERAL PERFORMANCE GOALS. Prior to the beginning of a
Performance Period the Committee will establish in writing Performance Goals for
the Company and its various operating units. The goals will be comprised of
specified levels of one or more performance criteria as the Committee may deem
appropriate such as: earnings per share, net earnings, operating earnings, unit
volume, net sales, market share, balance sheet measurements, revenue, economic
profit, cash flow, cash return on assets, shareowner return, return on equity,
return on capital or other value-based performance measures. The Committee may
disregard or offset the effect of any special charges or gains or cumulative
effect of a change in accounting in determining the attainment of Performance
Goals. Awards may also be payable when Company performance, as measured by one
or more of the above criteria, as compared to peer companies meets or exceeds an
objective criterion established by the Committee.
sec.4.6 AWARDS IN LIEU OF SALARY OR BONUS. The Committee may, in its sole
discretion, subject to Section 3.2 and such terms and conditions as the
Committee may prescribe, give Participants the opportunity to receive Awards in
lieu of future salary, bonus or other compensation.
ARTICLE V
STOCK OPTIONS AND STOCK APPRECIATION RIGHTS
sec.5.1 AWARD OF STOCK OPTIONS. The Committee may, from time to time,
subject to Section 3.2(b) and other provisions of the Plan and such terms and
conditions as the Committee may prescribe, award Incentive Stock Options and
Nonqualified Stock Options to any Key Employee. Awards of Incentive Stock
Options and Nonqualified Stock Options must be separate and not in tandem.
A-4
<PAGE> 42
sec.5.2 PERIOD OF OPTION.
(a) An Option granted under the Plan shall be exercisable only in
accordance with the vesting schedule approved by the Committee. After the
waiting period, the Option may be exercised at any time during the term of the
Option, in whole or in installments, as specified in the related Stock Option
Statement. Subject to Section 5.6, the duration of each Option shall not be more
than ten years from the date of grant.
(b) Except as provided in Section 5.6, a Participant may not exercise an
Option unless such Participant is then, and continually (except for sick leave,
military service, or other approved leave of absence) after the grant of the
Option has been, an employee of the Campbell Group.
sec.5.3 STOCK OPTION AWARD STATEMENT OR AGREEMENT. Each Option shall be
evidenced by a Statement or an option agreement.
sec.5.4 OPTION PRICE, EXERCISE AND PAYMENT. The Option Price of Campbell
Stock under each Option shall be determined by the Committee but shall be a
price not less than 100 percent of the Fair Market Value of Campbell Stock at
the date such Option is granted, as determined by the Committee. Stock Options
shall not be repriced.
Options may be exercised from time to time by giving written notice to the
Treasurer of the Company, or his or her designee, specifying the number of
shares to be purchased. The notice of exercise shall be accompanied by payment
in full of the Option Price in cash or the Option Price may be paid in whole or
in part through the transfer to the Company of shares of Campbell Stock.
In the event such Option Price is paid in whole or in part, with shares of
Campbell Stock, the portion of the Option Price so paid shall be equal to the
value, as of the date of exercise of the Option, of such shares. The value of
such shares shall be equal to the number of such shares multiplied by the
average of the high and low sales prices of Campbell Stock quoted on the New
York Stock Exchange composite tape on the trading day coincident with the date
of exercise of such Option (or the immediately preceding trading day if the date
of exercise is not a trading day). The Company shall not issue or transfer
Campbell Stock upon exercise of an Option until the Option Price is fully paid.
The Participant may satisfy any minimum amounts required to be withheld by the
Company under applicable federal, state and local tax laws in effect from time
to time, by electing to have the Company withhold a portion of the shares of
Campbell Stock to be delivered for the payment of such taxes.
sec.5.5 LIMITATIONS ON INCENTIVE STOCK OPTIONS. Each provision of the
Plan and each Option Statement relating to an Incentive Stock Option shall be
construed so that each Incentive Stock Option shall be an incentive stock option
as defined in Section 422 of the Code, and any provisions of the Option
Statement thereof that cannot be so construed shall be disregarded.
sec.5.6 TERMINATION OF EMPLOYMENT. The following provisions will govern
the ability of a Participant to exercise any outstanding Options or SARs
following the Participant's termination of employment with the Campbell Group.
(a) If the employment of a Participant with the Campbell Group is
terminated for reasons other than (i) death, (ii) discharge for Cause,
(iii) retirement, or (iv) resignation, the Participant may exercise a SAR
or an Option, except an Incentive Stock Option, at any time within three
years after such termination, to the extent of the number of shares covered
by such Option or SAR which were exercisable at the date of such
termination; except that an Option or SAR shall not be exercisable on any
date beyond the expiration of such three-year period or the expiration date
of such Option or SAR, whichever occurs first.
(b) If the employment of a Participant with the Campbell Group is
terminated for Cause, any Options or SARs of such Participant shall expire
and any rights thereunder shall terminate immediately.
A-5
<PAGE> 43
(c) Any Option or SAR of a Participant whose service is terminated by
resignation may be exercised at any time within three months of such
resignation to the extent that the number of shares covered by such Option
or SAR were exercisable at the date of such resignation, except that an
Option or SAR shall not be exercisable on any date beyond the expiration
date of such Option or SAR.
(d) Should a Participant, who is not eligible to retire under the
Company's pension plan or a pension plan of any affiliated Company, die
either while in the employ of the Campbell Group or after termination of
such employment (other than discharge for Cause), the SAR or Option rights,
except Incentive Stock Option Rights, of such deceased Participant may be
exercised by his or her Personal Representative at any time within three
years after the Participant's death to the extent of the number of shares
covered by such Option or SAR which were exercisable at the date of such
death, except that an Option or SAR shall not be so exercisable on any date
beyond the expiration date of such Option or SAR.
(e) After February 29, 1996, should a Participant who is eligible to
retire under the Company's pension plan or a pension plan of any affiliated
company die prior to the vesting of all Options or SARs, any installment or
installments not then exercisable shall become fully exercisable as of the
date of Participant's death and the SARs or Option rights, except Incentive
Stock Option Rights, may be exercised by the Participant's Personal
Representative at any time prior to the expiration date of any Option or
SAR.
(f) Should a Participant who retires after February 29, 1996, die
prior to exercising all Options or SARs, then his or her SAR and Option
rights, except Incentive Stock Option Rights, may be exercised by the
Participant's Personal Representative at any time prior to the expiration
date of any Options or SAR.
(g) If a Participant who was granted an Option or SAR dies within 180
days of the expiration date of such Option or SAR, and if on the date of
death the Participant was then entitled to exercise such Option or SAR,
including Options and SARs vested pursuant to section 5.6 (e), and if the
Option or SAR expires without being exercised, the Personal Representative
of the Participant shall receive in settlement a cash payment from the
Company of a sum equal to the amount, if any, by which the Fair Market
Value (determined on the expiration date of the Option or SAR) of Campbell
Stock subject to the Option or SAR exceeds the Option Price.
(h) Any SAR or Option, except an Incentive Stock Option, of a
Participant who retires after February 29, 1996, may be exercised at any
time prior to the expiration date of such Option or SAR. In the event the
Participant's employment with the Campbell Group terminates prior to the
vesting of all Options and SARs, and if the Participant is eligible to
retire under the Company's pension plan or a pension plan of any affiliated
company at the date of such termination, any installment or installments
not then exercisable shall become fully exercisable as of the effective
date of such termination. If the Participant receives severance payments
from the Company or any affiliated company and becomes eligible to retire
during the severance payment period, all of the Participant's Options and
SARs shall become fully exercisable as of the date of such Participant's
retirement eligibility date and may be exercised at any time prior to the
expiration date of such Option or SAR.
(i) Incentive Stock Options that have not previously expired must be
exercised within three months following Participant's termination of
employment, unless employment is terminated because of disability in which
event the exercise period is extended to one year following termination.
(j) Notwithstanding the provisions of subsections (a) through (i)
above, if the employment of a Participant with the Campbell Group is
terminated upon the spin-off of Vlasic Foods International Inc. ("Vlasic")
from the Company and he or she is immediately thereafter employed by Vlasic
or a subsidiary thereof, it shall not be considered a 'termination from the
Campbell Group' with respect to any Nonqualified Stock Option that the
Participant had a right to exercise, by the terms of the applicable vesting
schedule, immediately before the termination of employment with the
Campbell
A-6
<PAGE> 44
Group. The provisions of subsection (a) through (i) above shall then be
applied by considering employment with Vlasic and its subsidiaries the same
as employment with the Campbell Group.
sec.5.7 SHAREOWNER RIGHTS AND PRIVILEGES. A Participant shall have no
rights as a shareowner with respect to any shares of Campbell Stock covered by
an Option until the issuance of shares to the Participant.
sec.5.8 AWARD OF SARS.
(a) At any time prior to six months before an Option's expiration date, the
Committee may award to the Participant a SAR related to the Option. The
Committee may also award SARs that are unrelated to any Option.
(b) The SAR shall represent the right to receive payment of an amount not
greater than the spread, if any, by which the Fair Market Value of the Campbell
Stock on the trading day immediately preceding the date of exercise of the SAR
exceeds the Option Price.
(c) SARs awarded under the Plan shall be evidenced by a Statement between
the Company and the Participant.
(d) The Committee may prescribe conditions and limitations on the exercise
or transferability of any SAR. SARs may be exercised only when the value of a
share of Campbell Stock exceeds the Option Price. Such value shall be determined
in the manner specified in Section 5.8(b).
(e) A SAR shall be exercisable only by written notice to the Treasurer of
the Company or his or her designee. However, a SAR shall in no event be
exercisable during the first six months of its term, except in the event of
death or disability of the Participant prior to the expiration of such six-month
period.
(f) All SARs shall automatically be exercised on the last trading day prior
to their expiration, so long as the value of a share of Campbell Stock exceeds
the Option Price, unless prior to such day the holder instructs the Treasurer
otherwise in writing. Such value shall be determined in the manner specified in
Section 5.8(b).
(g) Payment of the amount to which a Participant is entitled upon the
exercise of a SAR shall be made in cash, Campbell Stock, or partly in cash and
partly in Campbell Stock at the discretion of the Committee. The shares shall be
valued in the manner specified in Section 5.8(b).
(h) At any time when a Participant is, in the judgment of the Treasurer of
the Company, subject with respect to Campbell Stock to Section 16 of the
Securities Exchange Act of 1934:
(i) any election by such Participant to receive cash in whole or in
part upon the exercise of such SAR, shall be made only during the period
beginning on the third business day following the date of release by the
Company for publication of any quarterly or annual summary statement of its
sales and earnings and ending on the twelfth business day following such
date of release, and
(ii) in the event the Committee has not determined the form in which
such SAR will be paid (i.e., cash, shares of Campbell Stock, or any
combination thereof), any election to exercise such right in whole or in
part for cash shall be subject to the subsequent consent thereto, or
disapproval thereof, by the Committee in its sole discretion.
(i) Each SAR shall expire on a date determined by the Committee at the time
of Award.
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ARTICLE VI
RESTRICTED STOCK
sec.6.1 AWARD OF RESTRICTED STOCK. The Committee may make a Restricted
Stock Award to any Participant, subject to this Article VI and to such other
terms and conditions as the Committee may prescribe.
sec.6.2 RESTRICTION PERIOD. At the time of making a Restricted Stock
Award, the Committee shall establish the Restriction Period applicable to such
Award. The Committee may establish different Restriction Periods from time to
time and each Restricted Stock Award may have a different Restriction Period, in
the discretion of the Committee. Restriction Periods, when established for each
Restricted Stock Award, shall not be changed except as permitted by Section 6.3.
sec.6.3 OTHER TERMS AND CONDITIONS. Campbell Stock, when awarded pursuant
to a Restricted Stock Award, will be represented by book entry in the name of
the Participant who receives the Restricted Stock Award, unless the Participant
has elected to defer pursuant to Section 10. The Participant shall be entitled
to receive dividends during the Restriction Period and shall have the right to
vote such Campbell Stock and all other shareowner's rights, with the exception
that (i) the Participant will not be entitled to delivery of the stock
certificate during the Restriction Period, (ii) the Company will retain custody
of the Campbell Stock during the Restriction Period, (iii) a breach of a
restriction or a breach of the terms and conditions established by the Committee
pursuant to the Restricted Stock Award will cause a forfeiture of the Restricted
Stock Award. The Participant may satisfy any amounts required to be withheld by
the Company under applicable federal, state and local tax laws in effect from
time to time, by electing to have the Company withhold a portion of the
Restricted Stock Award to be delivered for the payment of such taxes. The
Committee may, in addition, prescribe additional restrictions, terms, or
conditions upon or to the Restricted Stock Award including performance
restrictions in accordance with Section 4.5.
sec.6.4 RESTRICTED STOCK AWARD STATEMENT. Each Restricted Stock Award
shall be evidenced by a Restricted Stock Award Statement.
sec.6.5 TERMINATION OF EMPLOYMENT. The Committee may, in its sole
discretion, establish rules pertaining to the Restricted Stock Award in the
event of termination of employment (by retirement, disability, death, or
otherwise) of a Participant prior to the expiration of the Restriction Period.
If the employment of a Participant with the Campbell Group is terminated for
Cause, any non-vested Restricted Stock Awards of such Participant shall
immediately be forfeited and any rights thereunder shall terminate.
sec.6.6 PAYMENT FOR RESTRICTED STOCK. Restricted Stock Awards may be made
by the Committee under which the Participant shall not be required to make any
payment for the Campbell Stock or, in the alternative, under which the
Participant, as a condition to the Restricted Stock Award, shall pay all (or any
lesser amount than all) of the Fair Market Value of the Campbell Stock,
determined as of the date the Restricted Stock Award is made. If the latter,
such purchase price shall be paid in cash as provided in the Restricted Stock
Award Statement.
ARTICLE VII
AWARDS FOR NON-EMPLOYEE DIRECTORS
sec.7.1 AWARD TO NON-EMPLOYEE DIRECTORS. The Board will approve the
compensation of non-employee Directors and such compensation may consist of
Awards under the Plan. The Board retains the discretionary authority to make
Awards to non-employee Directors. All such Awards shall be subject to the terms
and conditions of the Plan and to such other terms and conditions consistent
with the Plan as the Board deems appropriate. The Board may, in its sole
discretion, subject to such terms and conditions as the Board may prescribe,
give non-employee Directors the opportunity to receive an option Award in lieu
of future cash compensation or other types of Awards.
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sec.7.2 ELECTION BY NON-EMPLOYEE DIRECTORS TO RECEIVE CAMPBELL
STOCK. Each non-employee Director may elect to receive all or a portion (in 10%
increments) of any cash compensation in shares of Campbell Stock, which will be
issued quarterly. Only whole numbers of shares will be issued. For purposes of
computing the number of shares earned and their taxable value each quarter, the
value of each share shall be equal to the mean between the reported high and low
prices of Campbell Stock on the New York Stock Exchange composite tape on the
last business day of the quarter. If a Participant dies prior to payment of all
shares earned, the balance due shall be payable in full to the Participant's
designated beneficiary under the Deferred Compensation Plan, or, if none, to the
Participant's estate, in cash.
sec.7.3 NO RIGHT TO CONTINUANCE AS A DIRECTOR. Neither the action of the
Company in establishing the Plan, nor any award under the Plan shall be deemed
(i) to create any obligation on the part of the Board to nominate any Director
for reelection by the Company's shareowners or (ii) to be evidence of any
agreement or understanding, express or implied, that the Director has a right to
continue as a Director for any period of time or at any particular rate of
compensation.
ARTICLE VIII
UNRESTRICTED CAMPBELL STOCK AWARDS FOR KEY EMPLOYEES
sec.8.1 The Committee may make awards of unrestricted Campbell Stock to
Key Employees in recognition of outstanding achievements or as an award for Key
Employees who receive Restricted Stock Awards when Performance Goals are
exceeded.
ARTICLE IX
AWARD OF PERFORMANCE UNITS
sec.9.1 AWARD OF PERFORMANCE UNITS. The Committee may award Performance
Units to any Participant. Each Performance Unit shall represent the right of a
Participant to receive an amount equal to the value of the Performance Unit,
determined in the manner established by the Committee at the time of Award.
sec.9.2 PERFORMANCE PERIOD. At the time of each Performance Unit Award,
the Committee shall establish, with respect to each such Award, a Performance
Period during which performance shall be measured. There may be more than one
Award in existence at any one time, and Performance Periods may differ.
sec.9.3 PERFORMANCE MEASURES. Performance Units shall be awarded to a
Participant contingent upon the attainment of Performance Goals in accordance
with Section 4.5.
sec.9.4 PERFORMANCE UNIT VALUE. Each Performance Unit shall have a
maximum dollar value established by the Committee at the time of the Award.
Performance Units earned will be determined by the Committee in respect of a
Performance Period in relation to the degree of attainment of Performance Goals.
The measure of a Performance Unit may, in the discretion of the Committee, be
equal to the Fair Market Value of one share of Campbell Stock.
sec.9.5 AWARD CRITERIA. In determining the number of Performance Units to
be granted to any Participant, the Committee shall take into account the
Participant's responsibility level, performance, potential, cash compensation
level, other incentive awards, and such other considerations as it deems
appropriate.
sec.9.6 PAYMENT. (a) Following the end of Performance Period, a
Participant holding Performance Units will be entitled to receive payment of an
amount, not exceeding the maximum value of the Performance Units, based on the
achievement of the performance measures for such Performance Period, as
determined by the Committee.
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(b) Payment of Performance Units shall be made in cash, whether payment is
made at the end of the Performance Period or is deferred pursuant to Section
10.1, except that Performance Units which are measured using Campbell Stock
shall be paid in Campbell Stock. Payment shall be made in a lump sum or in
installments and shall be subject to such other terms and conditions as shall be
determined by the Committee.
sec.9.7 TERMINATION OF EMPLOYMENT. (a) A Performance Unit Award shall
terminate for all purposes if the Participant does not remain continuously in
the employ of the Campbell Group at all times during the applicable Performance
Period, except as may otherwise be determined by the Committee.
(b) In the event that a Participant holding a Performance Unit ceases to be
an employee of the Campbell Group following the end of the applicable
Performance Period but prior to full payment according to the terms of the
Performance Unit Award, payment shall be made in accordance with terms
established by the Committee for the payment of such Performance Unit.
sec.9.8 PERFORMANCE UNIT STATEMENTS. Performance Unit Awards shall be
evidenced by Performance Unit Statements.
ARTICLE X
DEFERRAL OF PAYMENTS
sec.10.1 ELECTION TO DEFER. A Participant may elect to defer all or a
portion of any related earned Performance Units, Restricted Stock, unrestricted
Campbell Stock or gain on any exercised Option or SAR pursuant to the terms of
the Deferred Compensation Plan. The value of the Performance Units, Restricted
Stock, unrestricted Campbell Stock or Option or SAR gain so deferred shall be
allocated to a Deferred Account established for the Participant under the
Deferred Compensation Plan.
ARTICLE XI
MISCELLANEOUS PROVISIONS
sec.11.1 LIMITS AS TO TRANSFERABILITY. An Option may, at the election of
the Participant, be transferred to the spouse or a descendant of the
Participant, or a trust for the benefit of the spouse or descendants. Unless
otherwise provided by the Committee, however, no SAR, share of Restricted Stock,
or Performance Unit under the Plan shall be transferable by the Participant
otherwise than by will or, if the Participant dies intestate, by the laws of
descent and distribution. All Awards other than Options that are transferred in
accordance with the foregoing provisions shall be exercisable or received during
the Participant's lifetime only by such Participant or his or her Personal
Representative, or by will or if the Participant dies intestate, by the laws of
descent and distribution. Any transfer contrary to this Section 11.1 will
nullify the Option, SAR, Performance Unit, or share of Restricted Stock.
sec.11.2 ADJUSTMENTS UPON CHANGES IN STOCK. In case of any
reorganization, recapitalization, stock split, stock dividend, combination of
shares, merger, consolidation, rights offering, or any other changes in the
corporate structure or shares of the Company, appropriate adjustments may be
made by the Committee (or if the Company is not the surviving corporation in any
such transaction, the board of directors of the surviving corporation) in
Deferred Accounts and in the aggregate number and kind of shares subject to the
Plan, and the number and kind of shares and the price per share subject to
outstanding Options or which may be issued under outstanding Restricted Stock
Awards or pursuant to unrestricted Campbell Stock Awards. Appropriate
adjustments may also be made by the Committee in the terms of any Awards under
the Plan, subject to Article VII, to reflect such changes and to modify any
other terms of outstanding Awards on an equitable basis, including modifications
of Performance Goals and changes in the length of Performance Periods.
sec.11.3 AMENDMENT, SUSPENSION, AND TERMINATION OF PLAN. (a) The Board
may suspend or terminate the Plan or any portion thereof at any time, and may
amend, subject to Section 7.6, the Plan
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from time to time in such respects as the Board may deem advisable in order that
any Awards thereunder shall conform to any change in applicable laws or
regulations or in any other respect the Board may deem to be in the best
interests of the Company; provided, however, that no such amendment shall,
without shareowner approval, (i) except as provided in Sections 7.2 and 11.2,
increase the number of shares of Campbell Stock which may be issued under the
Plan, (ii) materially increase the benefits accruing to Participants under the
Plan, or (iii) materially modify the requirements as to eligibility for
participating in the Plan, or (iv) extend the termination date of the Plan. No
such amendment, suspension, or termination shall alter or impair any outstanding
Options, SARs, shares of Restricted Stock, or Performance Units without the
consent of the Participant affected thereby.
(b) With the consent of the Participant affected thereby, the Committee may
amend or modify any outstanding Options, Restricted Stock Awards, or Performance
Unit Awards in any manner to the extent that the Committee would have had the
authority under the Plan initially to award such Options, SARs, Restricted Stock
Awards, or Performance Unit Awards as so modified or amended, including without
limitation, to change the date or dates as of which such Options or SARs may be
exercised, to remove the restrictions on shares of Restricted Stock, or to
modify the manner in which Performance Units are determined and paid.
sec.11.4 NONUNIFORM DETERMINATIONS. The Committee's determinations under
the Plan, including without limitation, (i) the determination of the Key
Employees to receive Awards, (ii) the form, amount, and timing of such Awards,
(iii) the terms and provisions of such Awards and (iv) the Statements evidencing
the same, need not be uniform and may be made by it selectively among Key
Employees who receive, or who are eligible to receive, Awards under the Plan,
whether or not such Key Employees are similarly situated. This Section 11.4
shall not apply to current Campbell Stock Awards to non-employee Directors which
shall be uniform and non-discretionary in accordance with Article VII.
sec.11.5 GENERAL RESTRICTION. Each Award under the Plan shall be subject
to the condition that, if at any time the Committee shall determine that (i) the
listing, registration, or qualification of the shares of Campbell Stock subject
or related thereto upon any securities exchange or under any state or federal
law (ii) the consent or approval of any government or regulatory body, or (iii)
an agreement by the Participant with respect thereto, is necessary or desirable,
then such Award shall not become exercisable in whole or in part unless such
listing, registration, qualification, consent, approval, or agreement shall have
been effected or obtained free of any conditions not acceptable to the
Committee.
sec.11.6 NO RIGHT TO EMPLOYMENT. Neither the action of the Company in
establishing the Plan, nor any action taken by it or by the Board or the
Committee under the Plan, nor any provision of the Plan, shall be construed as
giving to any person the right to be retained in the employ of the Company or
any Subsidiary.
ARTICLE XII
CHANGE IN CONTROL OF THE COMPANY
sec.12.1 CONTRARY PROVISIONS. Notwithstanding anything contained in the
Plan to the contrary, the provisions of this Article XII shall govern and
supersede any inconsistent terms or provisions of the Plan.
sec.12.2 DEFINITIONS.
CHANGE IN CONTROL. (a) For purposes of the Plan "Change in Control" shall
mean any of the following events: (a) The acquisition in one or more
transactions by any "Person" (as the term person is used for purposes of Section
13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the "1934
Act")) of "Beneficial Ownership" (within the meaning of Rule 13d-3 promulgated
under the 1934 Act) of twenty-five percent (25%) or more of the combined voting
power of the Company's then outstanding voting securities (the "Voting
Securities"), provided, however, that for purposes of this Section 12.2(a), the
Voting Securities acquired directly from the Company by any Person shall be
excluded from the determination of such Person's Beneficial Ownership of Voting
Securities (but such
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Voting Securities shall be included in the calculation of the total number of
Voting Securities then outstanding); or
(b) The individuals who, as of January 25, 1990, are members of the Board
(the "Incumbent Board"), cease for any reason to constitute at least two-thirds
of the Board; provided, however, that if the election, or nomination for
election by the Company's shareowners, of any new Director was approved by a
vote of at least two-thirds of the Incumbent Board, such new Director shall, for
purposes of the Plan, be considered as a member of the Incumbent Board; or
(c) Approval by shareowners of the Company of (1) a merger or consolidation
involving the Company if the shareowners of the Company, immediately before such
merger or consolidation, do not own, directly or indirectly immediately
following such merger or consolidation, more than eighty percent (80%) of the
combined voting power of the outstanding voting securities of the corporation
resulting from such merger or consolidation in substantially the same proportion
as their ownership of the Voting Securities immediately before such merger or
consolidation or (2) a complete liquidation or dissolution of the Company or an
agreement for the sale or other disposition of all or substantially all of the
assets of the Company; or
(d) Acceptance of shareowners of the Company of shares in a share exchange
if the shareowners of the Company, immediately before such share exchange, do
not own, directly or indirectly immediately following such share exchange, more
than eighty percent (80%) of the combined voting power of the outstanding voting
securities of the corporation resulting from such share exchange in
substantially the same proportion as their ownership of the Voting Securities
outstanding immediately before such share exchange.
Notwithstanding the foregoing, a Change in Control shall not be deemed to
occur solely because twenty-five percent (25%) or more of the then outstanding
Voting Securities is acquired by (i) a trustee or other fiduciary holding
securities under one or more employee benefit plans maintained by the Company or
any of its subsidiaries, (ii) any corporation which, immediately prior to such
acquisition, is owned directly or indirectly by the shareowners of the Company
in the same proportion as their ownership of stock in the Company immediately
prior to such acquisition, (iii) any "Grandfathered Dorrance Family Shareowner"
(as hereinafter defined) or (iv) any Person who has acquired such Voting
Securities directly from any Grandfathered Dorrance Family Shareowner but only
if such Person has executed an agreement which is approved by two-thirds of the
Board and pursuant to which such Person has agreed that he (or they) will not
increase his (or their) Beneficial Ownership (directly or indirectly) to 30% or
more of the outstanding Voting Securities (the "Standstill Agreement") and only
for the period during which the Standstill Agreement is effective and fully
honored by such Person. For purposes of this Section, "Grandfathered Dorrance
Family Shareowner" shall mean at any time a "Dorrance Family Shareowner" (as
hereinafter defined) who or which is at the time in question the Beneficial
Owner solely of (v) Voting Securities Beneficially Owned by such individual on
January 25, 1990, (w) Voting Securities acquired directly from the Company, (x)
Voting Securities acquired directly from another Grandfathered Dorrance Family
Shareowner, (y) Voting Securities which are also Beneficially Owned by other
Grandfathered Dorrance Family Shareowners at the time in question, and (z)
Voting Securities acquired after January 25, 1990 other than directly from the
Company or from another Grandfathered Dorrance Family Shareowner by any
"Dorrance Grandchild" (as hereinafter defined) provided that the aggregate
amount of Voting Securities so acquired by each such Dorrance Grandchild shall
not exceed five percent (5%) of the Voting Securities outstanding at the time of
such acquisition. A "Dorrance Family Shareowner" who or which is at the time in
question the Beneficial Owner of Voting Securities which are not specified in
clauses (v), (w), (x), (y) and (z) of the immediately preceding sentence shall
not be a Grandfathered Dorrance Family Shareowner at the time in question. For
purposes of this Section, "Dorrance Family Shareowners" shall mean individuals
who are descendants of the late Dr. John T. Dorrance, Sr. and/or the spouses,
fiduciaries and foundations of such descendants. A "Dorrance Grandchild" means
as to each particular grandchild of the late Dr. John T. Dorrance, Sr., all of
the following taken collectively: such grandchild, such grandchild's descendants
and/or the spouses, fiduciaries and foundations of such grandchild and such
grandchild's descendants.
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Moreover, notwithstanding the foregoing, (i) a Change in Control shall not
be deemed to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the outstanding Voting
Securities as a result of the acquisition of Voting Securities by the Company
which, by reducing the number of Voting Securities outstanding, increases the
proportional number of shares Beneficially Owned by the Subject Person, provided
that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of Voting Securities by the Company, and after
such share acquisition by the Company, the Subject Person becomes the Beneficial
Owner of any additional Voting Securities which increases the percentage of the
then outstanding Voting Securities Beneficially Owned by the Subject Person,
then a Change in Control shall occur and (ii) a Change in Control described in
sec.12.2(a) with respect to any Participant shall not be deemed to occur by
reason of the Participant's acquisition of Beneficial Ownership (including the
acquisition of Beneficial Ownership by a group of which the Participant is a
member) with respect to any transaction on which the Participant would rely on
Rule 16b-3(e) promulgated under the Exchange Act.
sec.12.3 "ADJUSTED FAIR MARKET VALUE" means, in the event of a Change in
Control, the greater of (a) the highest price per share of Campbell Stock paid
to holders of the shares of Campbell Stock in any transaction (or series of
transactions) constituting or resulting in a Change in Control or (b) the
highest Fair Market Value of a share of Campbell Stock during the ninety (90)
day period ending on the date of a Change in Control.
sec.12.4 EFFECT OF CHANGE IN CONTROL ON OPTIONS AND SARS. Upon a Change
in Control, (a) all Options and SARs outstanding on the date of such Change in
Control shall become immediately and fully exercisable and (b) any Participant
who may be subject to liability under Section 16(b) of Securities Exchange Act
of 1934, as amended, will be permitted to surrender for cancellation for a
period of sixty (60) days commencing after the later of such Change in Control
or the expiration of six months from the date of grant, any Option or SAR (or
portion of an Option or SAR), to the extent not yet exercised and the
Participant will be entitled to receive a cash payment in an amount equal to the
excess, if any, in respect of each Option or SAR surrendered, (1)(i) except as
described in clause (ii) below, the greater of (x) the Fair Market Value, on the
date preceding the date of surrender of the shares subject to the Option or SAR
(or portion thereof) surrendered or (y) the Adjusted Fair Market Value of the
Shares subject to the Option or SAR (or portion thereof) surrendered or (ii) in
the case of an Incentive Stock Option or a SAR issued in connection with an
Incentive Stock Option, the Fair Market Value, on the date preceding the date of
surrender, of the Shares subject to the Option or SAR (or portion thereof)
surrendered, over (2) the aggregate purchase price for such Shares under the
Option or SAR.
sec.12.5 EFFECT OF CHANGE IN CONTROL ON RESTRICTED STOCK. Upon a Change
in Control, all restrictions upon any shares of Restricted Stock other than
Restricted Stock which is subject to performance related restrictions
("Performance Restricted Stock") shall lapse immediately and all such shares
shall become fully vested in the Participant and shall promptly be delivered to
the Participant.
sec.12.6 EFFECT OF CHANGE IN CONTROL ON PERFORMANCE RESTRICTED STOCK AND
PERFORMANCE UNITS
(a) Upon a Change in Control, the Participant shall (1) become vested in,
and restrictions shall lapse on, the greater of (i) fifty percent (50%) of the
Performance Restricted Stock or Performance Units or (ii) a pro rata portion of
such Performance Restricted Campbell Stock based on the portion of the
Performance Period that has elapsed to the date of the Change in Control and the
aggregate vesting percentage determined pursuant to this clause (ii) shall be
applied to vesting first such awards granted the farthest in time preceding the
Change in Control (the "Vested Performance Awards") and (2) be entitled to
receive (A) in respect of all Performance Units which become vested as a result
of a Change in Control, a cash payment within thirty (30) days after such Change
in Control equal to the product of the then current value of a Performance Unit
multiplied by the number of Performance Units which become vested in accordance
with this sec.12.6 and (B) in respect of all shares of Performance Restricted
Stock which become vested as a result of a Change in Control, the prompt
delivery of such shares.
(b) With respect to any shares of Performance Restricted Stock or
Performance Units which do not become vested pursuant to sec.12.6(a) (the
"Continuing Awards"), such shares or units (or the proceeds
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<PAGE> 51
thereof) shall continue to be outstanding for the remainder of the applicable
Performance Period (as if such shares or units were the only shares or units
granted in respect of each such Performance Period) and subject to the
applicable Award Criteria as modified below.
sec.12.7 AMENDMENT OR TERMINATION. (a) This Article XII shall not be
amended or terminated at any time if any such amendment or termination would
adversely affect the rights of any Participant under the Plan.
(b) For a period of twenty-four (24) months following a Change in Control,
the Plan shall not be terminated (unless replaced by a comparable long-term
incentive plan) and during such period the Plan (or such replacement plan) shall
be administered in a manner such that Participants will be provided with
long-term incentive awards producing reward opportunities generally comparable
to those provided prior to the Change in Control. Any amendment or termination
of the Plan prior to a Change in Control which (1) was at the request of a third
party who has indicated an intention or taken steps reasonably calculated to
effect a Change in Control or (2) otherwise arose in connection with or in
anticipation of a Change in Control, shall be null and void and shall have no
effect whatsoever.
(c) Following a Change in Control, the Plan shall be amended as necessary
to make appropriate adjustments to the Award Criteria for the Continuing Awards
for (a) any negative effect that the costs and expenses incurred by the Company
and its Subsidiaries in connection with the Change in Control may have on the
achievement of Performance Goals under the Plan and (b) any changes to the
Company and/or its Subsidiaries (including, but not limited to, changes in
corporate structure, capitalization and increased interest expense as a result
of the incurrence or assumption by the Company of acquisition indebtedness)
following the Change in Control so as to preserve the reward opportunities and
Award Criteria for comparable performance under the Plan as in effect on the
date immediately prior to the Change in Control.
sec.12.8 TRUST ARRANGEMENT. All benefits under the Plan represent an
unsecured promise to pay by the Company. The Plan shall be unfunded and the
benefits hereunder shall be paid only from the general assets of the Company
resulting in the Participants having no greater rights than the Company's
general creditors; provided, however, nothing herein shall prevent or prohibit
the Company from establishing a trust or other arrangement for the purpose of
providing for the payment of the benefits payable under the Plan.
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- --------------------------------------------------------------------------------
CAMPBELL SOUP COMPANY
------------------------
MANAGEMENT WORLDWIDE INCENTIVE PLAN
------------------------
As amended: November 18, 1999
- --------------------------------------------------------------------------------
Appendix B
<PAGE> 53
MANAGEMENT WORLDWIDE INCENTIVE PLAN
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE PAGE
- ------- ----
<S> <C> <C>
I. Purpose..................................................... B-1
II. Definitions................................................. B-1
III. Administration.............................................. B-2
IV. Participation............................................... B-2
V. Awards...................................................... B-2
VI. Limitations................................................. B-3
VII. Amendment, Suspension or Termination of the Plan in Whole or B-4
in Part.....................................................
VIII. Change in Control of the Company............................ B-4
IX. Miscellaneous............................................... B-6
</TABLE>
<PAGE> 54
CAMPBELL SOUP COMPANY
MANAGEMENT WORLDWIDE INCENTIVE PLAN
ARTICLE I
PURPOSE
sec.1.1 The purpose of the Plan is to provide annual financial incentives
for selected employees of the Campbell Group, thereby promoting the growth and
financial success of the Campbell Group by (1) attracting and retaining
employees of outstanding ability, (2) strengthening the Campbell Group's
capability to develop, maintain, and direct a competent management team, (3)
motivating employees to achieve annual Performance Goals and objectives, and (4)
providing incentive compensation opportunities competitive with those of other
major corporations.
ARTICLE II
DEFINITIONS
The following words and phrases, as used in the Plan, shall have these
meanings:
sec.2.1 "BOARD" means the Board of Directors of the Company.
sec.2.2 "CAMPBELL GROUP" means the Company and all of its Subsidiaries.
sec.2.3 "CAUSE" except for purposes of Article VIII, means the termination
of a Participant's employment by reason of his or her (1) engaging in gross
misconduct that is injurious to the Campbell Group, monetarily or otherwise, (2)
misappropriation of funds, (3) willful misrepresentation to the directors or
officers of the Campbell Group, (4) gross negligence in the performance of the
Participant's duties having an adverse effect on the business, operations,
assets, properties or financial condition of the Campbell Group, (5) conviction
of a crime involving moral turpitude, or (6) entering into competition with the
Campbell Group. The determination of whether a Participant's employment was
terminated for Cause shall be made by the Company in its sole discretion.
sec.2.4 "CAMPBELL STOCK" means Capital Stock of the Company.
sec.2.5 "COMMITTEE" means the Compensation and Organization Committee of
the Board. All members of the Committee shall be "Outside Directors," as defined
or interpreted for purposes of Section 162(m) of the Code, and "Non-Employee
Directors," within the meaning of Rule 16b-3 under the Securities Exchange Act
of 1934.
sec.2.6 "COMPANY" means Campbell Soup Company and its successors and
assigns.
sec.2.7 "DEFERRED COMPENSATION PLAN" means the Campbell Soup Company
Deferred Compensation Plan.
sec.2.8 "DIRECTOR" means a member of the Board who is not an Eligible
Employee.
sec.2.9 "ELIGIBLE EMPLOYEE" means a person who at the end of the fiscal
year is a regular full-time salaried employee of the Campbell Group and who, in
the opinion of the Committee, is a key employee whose performance can contribute
to the successful management of the Campbell Group, including a person whose
services terminated before the end of the fiscal year, but not including a
person serving only as a director of the Company or a Subsidiary.
sec.2.10 "PERFORMANCE GOALS" means the goals established by the Committee
pursuant to Article V.
sec.2.11 "PARTICIPANT" means a person to whom an award of incentive
compensation has been made under the Plan.
sec.2.12 "PLAN" means the Campbell Soup Company Management Worldwide
Incentive Plan.
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<PAGE> 55
sec.2.13 "PRESIDENT" means the President of the Company.
sec.2.14 "SHAREOWNERS" means the Shareowners of the Company.
sec.2.15 "SUBSIDIARY" means a corporation, domestic or foreign, the
majority of the voting stock of which is owned directly or indirectly by the
Company.
ARTICLE III
ADMINISTRATION
sec.3.1 The Plan shall be administered by the Committee. The Committee
shall have all necessary powers to administer and interpret the Plan, such
powers to include the authority to select Eligible Employees to whom awards may
be granted under the Plan and to determine the amount of any award of incentive
compensation to be granted to any Eligible Employee, except that the amount of
any incentive compensation to be granted by the Committee to any Eligible
Employee who is also a Director of the Company shall be approved by the Board. A
Director shall not participate in a vote approving the amount of the grant to
himself or herself. The Committee shall have full power and authority to adopt
such rules, regulations and instruments for the administration of the Plan and
for the conduct of its business as the Committee deems necessary or advisable.
The Committee's interpretations of the Plan, and all actions taken and
determinations made by the Committee pursuant to the powers vested in it
hereunder, shall be conclusive and binding on all parties concerned, including
the Company, its Shareowners and any employee of the Campbell Group.
ARTICLE IV
PARTICIPATION
sec.4.1 Participants in the Plan shall be selected by the Committee from
among Eligible Employees based upon such criteria as the Committee may from time
to time determine.
ARTICLE V
AWARDS
sec.5.1 ESTABLISHMENT OF PERFORMANCE GOALS. Prior to the beginning of
each fiscal year the Committee will establish in writing Performance Goals for
the Company and its various operating units. The goals will be comprised of
specified annual levels of one or more performance criteria as the Committee may
deem appropriate such as: earnings per share, net earnings, operating earnings,
unit volume, net sales, market share, balance sheet measurements, revenue,
economic profit, cash flow, cash return on assets, shareowner return, return on
equity, return on capital or other value-based performance measures. The
Committee may disregard or offset the effect of any special charges or gains or
cumulative effect of a change in accounting in determining the attainment of
Performance Goals. Awards may also be payable when Company performance, as
measured by one or more of the above criteria, as compared to peer companies
meets or exceeds an objective criterion established by the Committee.
sec.5.2 ESTABLISHMENT OF AWARD CATEGORIES. Prior to the close of each
fiscal year, the Committee shall:
(a) be advised by such appropriate officer of the Company as it may
request, of the recommended estimated aggregate amount of awards of incentive
compensation to be granted under the Plan for such fiscal year; and
(b) determine whether awards shall be granted under the Plan for the fiscal
year and if so, determine, the classes of employees eligible to receive awards
of incentive compensation based upon job grade and salary levels and such other
procedures for the granting of the awards as the Committee may deem desirable.
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The class of employees determined to be eligible for awards shall not be
subject to change after the close of the fiscal year.
sec.5.3 ESTABLISHMENT OF AWARD AMOUNTS. After the close of the fiscal
year, the Committee may fix a maximum aggregate dollar amount which may be
granted for awards for that fiscal year. The amounts of awards to be granted
with respect to particular employees within the eligible classes may be
determined after the close of the fiscal year under procedures established by
the Committee.
sec.5.4 GRANT OF AWARDS. The Committee shall, in granting awards to
particular Eligible Employees for any fiscal year, take into consideration (a)
the performance of the Company or the organizational unit of the Eligible
Employee based upon attainment of Performance Goals and (b) as between
Participants, the contribution of the Participant during the fiscal year to the
success of the Company, including the Participant's (i) position and level of
responsibility, (ii) business unit, division or department achievements, and
(iii) management assessment of individual performance. No award or awards may be
granted to any Participant for the same fiscal year that exceeds in the
aggregate $5 million. The Committee shall have no discretion to increase such
awards.
sec.5.5 COMMITTEE DISCRETION. The Committee shall have complete
discretion with respect to the determination of the Eligible Employees to whom
awards of incentive compensation shall be granted and the granting of such
awards, except that the amount of any incentive compensation to be granted by
the Committee to any Eligible Employee who is also a Director of the Company
shall be approved by the Board in accordance with Article III.
sec.5.6 LIMITATION ON AWARDS. Notwithstanding any other provision of the
Plan, the Committee may not grant any award for any fiscal year, prior to a
Change in Control (as hereinafter defined), in which no cash dividend shall have
been paid on Campbell Stock.
sec.5.7 PAYMENT OF AWARDS. Incentive compensation awards made pursuant to
Article V shall be paid entirely in cash as soon as possible after grant
approval, unless the Participant is eligible for and has elected to defer
receipt of a portion or all of such award in accordance with the terms of the
Deferred Compensation Plan or unless the Committee, in its discretion, approves
the conversion of the award into stock options, restricted stock or unrestricted
stock pursuant to the Company's long-term incentive plan.
ARTICLE VI
LIMITATIONS
sec.6.1 RIGHTS NOT ABSOLUTE. No person shall at any time have any right
to be granted an award hereunder for any fiscal year, and no person shall have
authority to enter into an agreement committing the Company to make or pay an
award, nor shall any person have authority to make any representation or
warranty on behalf of the Company with respect thereto.
sec.6.2 PARTICIPANTS RIGHTS LIMITED TO PLAN. Participants receiving
awards shall have no rights to such awards except as set forth in this Plan.
sec.6.3 NO RIGHT TO CONTINUED EMPLOYMENT. Neither the action of the
Company in establishing the Plan, nor any action taken by it or by the Board or
the Committee under the Plan, nor any provision of the Plan, shall be construed
as giving to any person the right to be retained in the employ of the Campbell
Group.
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<PAGE> 57
ARTICLE VII
AMENDMENT, SUSPENSION OR TERMINATION OF
THE PLAN IN WHOLE OR IN PART
sec.7.1 The Board may amend, suspend or terminate the Plan in whole or in
part; but it may not affect adversely rights or obligations with respect to
awards previously made. The Plan may be altered, changed or repealed by the
Shareowners; but such action shall not affect adversely rights or obligations
with respect to awards previously made.
ARTICLE VIII
CHANGE IN CONTROL OF THE COMPANY
sec.8.1 CONTRARY PROVISIONS. Notwithstanding anything contained in the
Plan to the contrary, the provisions of this Article VIII shall govern and
supersede any inconsistent terms or provisions of the Plan.
sec.8.2 DEFINITIONS OF "CHANGE IN CONTROL" AND "CAUSE." For purposes of
the Plan "Change in Control" shall mean any of the following events:
(a) The acquisition in one or more transactions by any "Person" (as the
term person is used for purposes of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended (the "1934 Act")) of "Beneficial Ownership"
(within the meaning of Rule 13d-3 promulgated under the 1934 Act) of twenty-five
percent (25%) or more of the combined voting power of the Company's then
outstanding voting securities (the "Voting Securities"), provided, however, that
for purposes of this Section 8.2(a), the Voting Securities acquired directly
from the Company by any Person shall be excluded from the determination of such
Person's Beneficial Ownership of Voting Securities (but such Voting Securities
shall be included in the calculation of the total number of Voting Securities
then outstanding); or
(b) The individuals who, as of January 25, 1990, are members of the Board
(the "Incumbent Board"), cease for any reason to constitute at least two-thirds
of the Board; provided, however, that if the election, or nomination for
election by the Company's Shareowners, of any new director was approved by a
vote of at least two-thirds of the Incumbent Board, such new director shall, for
purposes of the Plan, be considered as a member of the Incumbent Board; or
(c) Approval by Shareowners of the Company of (1) a merger or consolidation
involving the Company if the Shareowners of the Company, immediately before such
merger or consolidation, do not own, directly or indirectly immediately
following such merger or consolidation, more than eighty percent (80%) of the
combined voting power of the outstanding Voting Securities of the corporation
resulting from such merger or consolidation in substantially the same proportion
as their ownership of the Voting Securities immediately before such merger or
consolidation or (2) a complete liquidation or dissolution of the Company or an
agreement for the sale or other disposition of all or substantially all of the
assets of the Company; or
(d) Acceptance of Shareowners of the Company of shares in a share exchange
if the Shareowners of the Company, immediately before such share exchange, do
not own, directly or indirectly immediately following such share exchange, more
than eighty percent (80%) of the combined voting power of the outstanding Voting
Securities of the corporation resulting from such share exchange in
substantially the same proportion as their ownership of the Voting Securities
outstanding immediately before such share exchange.
Notwithstanding the foregoing, a Change in Control shall not be deemed to
occur solely because twenty-five percent (25%) or more of the then outstanding
Voting Securities is acquired by (i) a trustee or other fiduciary holding
securities under one or more employee benefit plans maintained by the Company or
any of its subsidiaries, (ii) any corporation which, immediately prior to such
acquisition, is owned directly or indirectly by the Shareowners of the Company
in the same proportion as their ownership of stock in the Company immediately
prior to such acquisition, (iii) any "Grandfathered
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<PAGE> 58
Dorrance Family Shareowner" (as hereinafter defined) or (iv) any Person who has
acquired such Voting Securities directly from any Grandfathered Dorrance Family
Shareowner but only if such Person has executed an agreement which is approved
by two-thirds of the Board and pursuant to which such Person has agreed that he
(or they) will not increase his (or their) Beneficial Ownership (directly or
indirectly) to 30% or more of the outstanding Voting Securities (the "Standstill
Agreement") and only for the period during which the Standstill Agreement is
effective and fully honored by such Person. For purposes of this Section,
"Grandfathered Dorrance Family Shareowner" shall mean at any time a "Dorrance
Family Shareowner" (as hereinafter defined) who or which is at the time in
question the Beneficial Owner solely of (v) Voting Securities Beneficially Owned
by such individual on January 25, 1990, (w) Voting Securities acquired directly
from the Company, (x) Voting Securities acquired directly from another
Grandfathered Dorrance Family Shareowner, (y) Voting Securities which are also
Beneficially Owned by other Grandfathered Dorrance Family Shareowners at the
time in question, and (z) Voting Securities acquired after January 25, 1990
other than directly from the Company or from another Grandfathered Dorrance
Family Shareowner by any "Dorrance Grandchild" (as hereinafter defined) provided
that the aggregate amount of Voting Securities so acquired by each such Dorrance
Grandchild shall not exceed five percent (5%) of the Voting Securities
outstanding at the time of such acquisition. A "Dorrance Family Shareowner" who
or which is at the time in question the Beneficial Owner of Voting Securities
which are not specified in clauses (v), (w), (x), (y) and (z) of the immediately
preceding sentence shall not be a Grandfathered Dorrance Family Shareowner at
the time in question. For purposes of this Section, "Dorrance Family
Shareowners" shall mean individuals who are descendants of the late Dr. John T.
Dorrance, Sr. and/or the spouses, fiduciaries and foundations of such
descendants. A "Dorrance Grandchild" means as to each particular grandchild of
the late Dr. John T. Dorrance, Sr., all of the following taken collectively:
such grandchild, such grandchild's descendants and/or the spouses, fiduciaries
and foundations of such grandchild and such grandchild's descendants.
Moreover, notwithstanding the foregoing, a Change in Control shall not be
deemed to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the outstanding Voting
Securities as a result of the acquisition of Voting Securities by the Company
which, by reducing the number of Voting Securities outstanding, increases the
proportional number of shares Beneficially Owned by the Subject Person, provided
that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of Voting Securities by the Company, and after
such share acquisition by the Company, the Subject Person becomes the Beneficial
Owner of any additional Voting Securities which increases the percentage of the
then outstanding Voting Securities Beneficially Owned by the Subject Person,
then a Change in Control shall occur.
"Cause." For purposes of this Article VIII only, the term Cause shall mean
the termination of a Participant's employment by reason of his or her (a)
conviction of a felony or (b) engaging in conduct which constitutes willful
gross misconduct which is demonstrably and materially injurious to the Company,
monetarily or otherwise. No act, nor failure to act, on the Employee's part,
shall be considered "willful" unless he or she has acted, or failed to act, with
an absence of good faith and without a reasonable belief that his or her action
or failure to act was in the best interest of the Company.
sec.8.3 CHANGE IN CONTROL AWARD. During any fiscal year in which a Change
in Control occurs ("Change in Control Year") each Eligible Employee who is a
Participant on the date immediately prior to the Change in Control (a) whose
employment with his or her employer is terminated prior to the end of the Change
in Control Year for any reason (other than by his or her employer for Cause) or
(b) who is in the employ of the Company or any Subsidiary on the last day of the
Change in Control Year, shall be entitled to receive, within thirty (30) days
thereafter, a cash payment equal to the greater of (x) his or her target award
for the Change in Control Year or (y) the average of the awards paid or payable
under the Plan for the two most recent fiscal years ended prior to the Change in
Control Year (the "Award"); provided, however that the amount of the Award to be
paid to each Participant as provided in clause (a) above shall be multiplied by
a fraction, the numerator of which shall be the number of calendar days from and
including the first day of the Change in Control Year through and including the
date the Participant's employment is terminated and the denominator of which
shall be 365; provided, further,
B-5
<PAGE> 59
however, that the Award to be paid to any Participant who is a party to an
individual severance agreement shall be reduced by the amount of the "Pro Rata
Bonus" (as defined in the severance agreement) that such Participant receives
under the severance agreement.
sec.8.4 CONTINUATION OF THE PLAN. For a period of two (2) years following
a Change in Control, the Plan shall not be terminated or amended in any way
(including, but not limited to, restricting or limiting any Eligible Employee's
right to participate in the Plan), nor shall the manner in which the Plan is
administered be changed in a way that adversely affects the level of
participation or reward opportunities of any Participant; provided, however,
that the Plan shall be amended as necessary to make appropriate adjustments for
(a) any negative effect that the costs and expenses incurred by the Company and
its Subsidiaries in connection with the Change in Control may have on the
benefits payable under the Plan and (b) any changes to the Company and/or its
Subsidiaries (including, but not limited to, changes in corporate structure,
capitalization and increased interest expense as a result of the incurrence or
assumption by the Company of acquisition indebtedness) following the Change in
Control so as to preserve the reward opportunities and performance targets for
comparable performance under the Plan as in effect on the date immediately prior
to the Change in Control.
sec.8.5 AMENDMENT OR TERMINATION. This Article VIII shall not be amended
or terminated at any time if any such amendment or termination would adversely
affect the rights of any Participants under the Plan.
sec.8.6 AMENDMENT OR TERMINATION PRIOR TO A CHANGE IN CONTROL. Any
amendment or termination of the Plan prior to a Change in Control which (1) was
at the request of a third party who has indicated an intention or taken steps
reasonably calculated to effect a Change in Control or (2) otherwise arose in
connection with or in anticipation of a Change in Control, shall be null and
void and shall have no effect whatsoever.
ARTICLE IX
MISCELLANEOUS
sec.9.1 NON-ALIENATION. No amounts payable under the Plan shall be
subject in any manner to anticipation, assignment, or voluntary or involuntary
alienation.
sec.9.2 GOVERNING LAW. This Plan shall be governed by and construed in
accordance with the laws of the State of New Jersey to the extent not preempted
by federal law.
sec.9.3 INCAPACITY. If the Committee, in its sole discretion, deems a
Participant who is eligible to receive any payment hereunder to be incompetent
to receive the same due to age, illness or any infirmity or incapacity of any
kind, the Committee may direct the employer to apply such payment directly for
the benefit of such person, or to make payment to any person selected by the
Committee to disburse the same for the benefit of the participant. Payments made
pursuant to this Section shall operate as a discharge, to the extent thereof, of
all liabilities of the employer, the Committee and the Plan to the person for
whose benefit the payments are made.
sec.9.4 TRUST ARRANGEMENT. All benefits under the Plan represent an
unsecured promise to pay by the Company. The Plan shall be unfunded and the
benefits hereunder shall be paid only from the general assets of the Company;
provided, however, nothing herein shall prevent or prohibit the Company from
establishing a trust or other arrangement for the purpose of providing for the
payment of the benefits payable under the Plan.
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<PAGE> 60
DIRECTIONS TO CIVIC CENTER
2025 SOUTH COLLEGIATE DRIVE
PARIS, TEXAS 75460
(903) 739-9912
[MAP OF DIRECTIONS TO LOVE CIVIC CENTER]
<PAGE> 61
[CAMPBELL SOUP COMPANY LOGO]
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING ON NOVEMBER 18, 1999
P R O X Y
The undersigned hereby appoints Dale F. Morrison, or, in his absence, Ellen O.
Kaden or, in the absence of both of them, John J. Furey, and each or any of
them, proxies with full power of substitution in each, to vote all shares the
undersigned is entitled to vote, at the Annual Meeting of Shareowners of
Campbell Soup Company to be held at the Civic Center, 2025 South Collegiate
Drive, Paris, Texas, at 11:00 a.m., Central Time, and at any adjournments
thereof, on all matters coming before the meeting, including the proposals
referred to on the reverse side hereof. If the undersigned is a participant in
one of the Campbell Soup Company Savings and 401(k) Plans or in the Campbell
Soup Company Ltd Employee Savings and Stock Bonus Plan (any of such plans, a
"Savings Plan"), then the undersigned hereby directs the respective trustee of
the applicable Savings Plan to vote all shares of Campbell Soup Company Capital
Stock in the undersigned's Savings Plan account at the aforesaid Annual Meeting
and at any adjournments thereof, on all matters coming before the meeting,
including the proposals referred to on the reverse side hereof.
1. ELECTION OF DIRECTORS
Nominees: 01) Alva A. App, 02) Edmund M. Carpenter, 03) Bennett Dorrance,
04) Thomas W. Field, Jr., 05) Kent B. Foster, 06) Harvey Golub, 07) David K.P.
Li, 08) Philip E. Lippincott, 09) Mary Alice D. Malone, 10) Dale F. Morrison,
11) Charles H. Mott, 12) Charles R. Perrin, 13) George M. Sherman, 14) Donald M.
Stewart, 15) George Strawbridge, Jr. and 16) Charlotte C. Weber. Directors
recommend a vote FOR
(Change of Address/Comments)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(If you have written in the above space, please mark the corresponding box on
the reverse side of this card)
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS JUST SIGN THE
REVERSE SIDE; NO BOXES NEED TO BE MARKED.
IF YOU DO NOT VOTE BY PHONE OR OVER THE INTERNET, PLEASE RETURN PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
SEE REVERSE SIDE
- --------------------------------------------------------------------------------
DIRECTIONS TO CIVIC CENTER
2025 SOUTH COLLEGIATE DRIVE
PARIS, TEXAS 75460
(903) 739-9912
FROM DALLAS/FORT WORTH AIRPORT:
Take North Exit out of airport
(Hwy. 121)
Continue on 121 across I-35
Take Hwy. 75 North
Exit at Hwy. 121 to Bonham
Take 82 East to Paris
Continue on 82 to Business 271 East/South
(also known as Clarksville St.)
Turn right on South Collegiate Drive
Follow South Collegiate Drive 3.4 miles
Civic Center is on your left.
[DETAILED MAP]
[MAP]
<PAGE> 62
[x] PLEASE MARK YOUR VOTES AS THIS EXAMPLE 6795
YOUR SHARES WILL BE VOTED AS RECOMMENDED BY THE BOARD OF DIRECTORS (OR, IN THE
CASE OF SHARES HELD IN A SAVINGS PLAN, WILL BE VOTED AT THE DISCRETION OF THE
TRUSTEE) UNLESS YOU OTHERWISE INDICATE IN WHICH CASE THEY WILL BE VOTED AS
MARKED.
THE BOARD RECOMMENDS A VOTE FOR ITEMS 1, 2, 3, AND 4.
FOR ALL NOMINEES, EXCEPT THOSE LISTED BELOW WITHHELD FROM ALL NOMINEES
/ / / /
1. Election of Directors (see reverse)
FOR, except vote withheld from the following nominee(s) - list numbers:
2.Ratification of Appointment of Auditors
FOR AGAINST ABSTAIN
/ / / / / /
3.Reapproval of the Company's 1994 Long-Term Incentive Plan
FOR AGAINST ABSTAIN
/ / / / / /
4. Reapproval of the Company's Management Worldwide Incentive Plan
FOR AGAINST ABSTAIN
/ / / / / /
MARK THIS BOX TO OBTAIN A TICKET OF ADMISSION TO THE MEETING. / /
CHANGE OF ADDRESS: MARK THIS BOX AND SEE THE REVERSE SIDE. / /
NOTE: PLEASE SIGN EXACTLY AS NAME APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN.
WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE
GIVE FULL TITLE AS SUCH.
_________________________________________________
_________________________________________________
SIGNATURE(S) DATE
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
[CAMPBELL SOUP COMPANY LOGO]
ANNUAL MEETING OF SHAREOWNERS -- NOVEMBER 18, 1999 -- 11:00 A.M., CENTRAL TIME
CIVIC CENTER - 2025 SOUTH COLLEGIATE DRIVE - PARIS, TEXAS
VOTE BY TELEPHONE OR INTERNET
QUICK - EASY - IMMEDIATE
Campbell Soup Company encourages you to take advantage of two new cost-effective
and convenient ways to vote your shares.
You may now vote your proxy 24 hours a day, 7 days a week, using either a
touch-tone telephone or through the Internet. YOUR TELEPHONE OR INTERNET VOTE
MUST BE RECEIVED BY 12:00 MIDNIGHT NEW YORK TIME ON NOVEMBER 17, 1999.
Your telephone or Internet vote authorizes the proxies named on the above proxy
card to vote your shares in the same manner as if you marked, signed, and
returned your proxy card.
VOTE BY PHONE: ON A TOUCH-TONE TELEPHONE DIAL 1-877-PRX-VOTE
(1-877-779-8683) FROM THE U.S. AND CANADA OR DIAL
201-536-8073 FROM OTHER COUNTRIES.
You will be asked to enter the VOTER CONTROL NUMBER located
in the box just below the perforation on the proxy card. Then
follow the instructions.
OR
VOTE BY INTERNET: POINT YOUR BROWSER TO THE WEB ADDRESS:
http://www.eproxyvote.com/cpb
Click on the PROCEED icon -- You will be asked to enter the
VOTER CONTROL NUMBER located in the box just below the
perforation on the proxy card. Then follow the instructions.
OR
VOTE BY MAIL: Mark, sign and date your proxy card and return it in the
postage-paid envelope. IF YOU ARE VOTING BY TELEPHONE OR THE
INTERNET, PLEASE DO NOT MAIL YOUR PROXY CARD.
