1
Exhibit 10.15
CHANGE IN CONTROL AGREEMENT
THIS CHANGE IN CONTROL AGREEMENT ("Agreement") dated as of August 1,
2000 (the "Effective Date") is entered by and between
__________________________("Executive") and Weider Nutrition Group, Inc., a Utah
corporation (the "Company").
WITNESSETH:
WHEREAS, Executive is a senior executive of the Company and has made
and is expected to continue to make major contributions to the short and long
term profitability, growth and financial strength of the Company;
WHEREAS, the Company recognizes that, as is the case for most publicly
held companies, the possibility of a Change in Control (as defined below)
exists;
WHEREAS, the Company desires to assure itself of both present and
future continuity of management;
WHEREAS, the Company wishes to ensure that Executive is not practically
disabled from discharging his duties in respect of a proposed or actual
transaction involving a Change in Control; and
WHEREAS, the Company desires to provide additional inducement for the
Executive to continue to remain in the employ of the Company.
NOW, THEREFORE, in exchange for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company and
Executive agree as follows:
1. Certain Defined Terms. In addition to terms defined elsewhere
herein, the following terms have the following meanings when used in this
Agreement with initial capital letters:
(a) "Affiliate" shall mean a domestic or foreign business entity
controlled by, controlling, under common control with, or in a joint venture
with, the applicable person or entity.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Cause" shall mean Executive's:
(i) Fraud, misappropriation, embezzlement, or other act of
material misconduct against the Company or any of its Affiliates;
1
2
(ii) Substantial and willful failure to perform specific and
lawful directives of the Board, as reasonably determined by the Board;
(iii) Willful and knowing violation of any rules or
regulations of any governmental or regulatory body, which is materially
injurious to the financial condition of the Company; or
(iv) Conviction of or plea of guilty or nolo contendere to a
felony.
(d) "Change in Control" shall mean the occurrence during the Term
of this Agreement (as set forth in Section 2) of both (i) and (ii), below:
(i) Change in the Board. A change in the composition of the
Board over a period of twelve consecutive months (or less) such that a majority
of the Board members (rounded up to the nearest whole number) ceases to be
comprised of individuals who either (A) have been Board members continuously
since the beginning of such period or (B) have been elected or nominated for
election as Board members during such period by at least a majority of the Board
members described in clause (A) who were still in office at the time such
election or nomination was approved by the Board; and
(ii) One of:
(A) Sale of Assets. The sale of all or substantially
all of the assets and business of the Company in substantially a single
transaction;
(B) Merger. The merger or consolidation of the Company
with and into another corporation if, following such merger or consolidation,
persons who were not direct or indirect shareholders of the Company immediately
prior to such event (other than persons in which such original shareholders
themselves have an interest) ("New Shareholders"), will collectively own stock
in the surviving corporation representing both (A) more than 30% of the
surviving corporation's total equity value and (B) more than that percentage of
the surviving corporation's total equity value owned by the Weider Group,
provided, however, that such merger or consolidation shall not be covered by
this paragraph (ii) if the Weider Group owns 30% or more of the surviving
corporation's total equity value and no New Shareholders who constitute a
"group" within the meaning of Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, own more than that percentage of the surviving corporation's
total equity value owned by the Weider Group; or
(C) Sale of Stock. Acquisition of 50% or more of the
fair market value of the outstanding capital stock of the Company by one or more
other persons if, following such acquisition, persons who were not direct or
indirect shareholders of the Company immediately prior to such event (other than
persons in which such original shareholders themselves have an interest), will
collectively own stock of the Company representing more than 50% of the
Company's total equity value.
2
3
(e) "Change in Control Value" shall mean the value per share of
Common Stock as of the effective time of any Change in Control, as determined in
good faith by the Board or any committee thereof.
(f) "Code" shall mean Internal Revenue Code of 1986, as amended.
(g) "Common Stock" shall mean the Company's Class A Common Stock,
par value $0.01 per share.
(h) "Exercise Price" shall mean the exercise price per share of
Common Stock subject to an Option.
(i) "Good Reason" shall mean any of the following events which is
not cured by the Company within 15 days after written notice thereof is provided
to the Company by Executive: (i) any material reduction in the total amount of
Executive's base salary or bonus; (ii) any material adverse change in
Executive's job titles, duties, responsibilities, perquisites or authority
without Executive's consent; or (iii) any involuntary relocation of Executive's
principal place of business to a location more than 50 miles from Executive's
current principal place of business.
(j) "New Option Spread" shall mean, solely with respect to any
Option granted to Executive on or following the Effective Date that is
outstanding immediately prior to a Change in Control, the product of (i) the
aggregate number of shares of Common Stock subject to such Option and (ii) the
excess of (A) the Change in Control Value over (B) the Exercise Price.
(k) "Option" shall mean an option to purchase shares of Common
Stock granted by the Company to Executive.
(l) "Weider Group" shall mean Weider Heath and Fitness, a Nevada
corporation (or its successor) and its Affiliates.
2. Term of Agreement. This Agreement shall be effective with respect
to any Change in Control that is both (i) subject to a definitive written
purchase, sale, merger or similar agreement entered into during the period
beginning on the Effective Date and ending on the expiration of 12 months
following the Effective Date and (ii) consummated on or prior to the expiration
of 18 months following the Effective Date.
3. Retention Bonus. In the event that:
(a) Executive continues his employment with the Company through
the effective date of a Change in Control,
(b) Executive's employment is terminated by the Company without
Cause prior to the effective date of a Change in Control, or
3
4
(c) Executive terminates his employment with the Company for Good
Reason,
the Company shall pay to Executive a lump-sum cash bonus (the "Retention Bonus")
in the amount of the excess of (x) $________, over (y) the New Option Spread.
The Retention Bonus shall be payable by the Company to Executive within 30 days
following the effective date of the Change in Control.
4. Parachute Payments. Notwithstanding any other provision of this
Agreement, to the extent Executive would be subject to the excise tax under
Section 4999 of the Code on the payment made under Section 3 hereof and any
other payments or benefits Executive would receive from the Company and its
Affiliates required to be included in the calculation of parachute payments for
purposes of Sections 280G and 4999 of the Code, the amount payable under this
Agreement shall be automatically reduced to an amount one dollar less than that,
when combined with such other amounts and benefits required to be so included,
would subject Executive to the excise tax under Section 4999 of the Code;
provided, however, that payments made under this Agreement shall be so reduced
only if the reduced amount received by Executive would be greater than the
unreduced amount to be received by Executive less the excise tax payable under
Section 4999 of the Code on such amount and the other amounts and benefits
received by Executive and required to be included in the calculation of a
parachute payment for purposes of Sections 280G and 4999 of the Code.
5. Successors and Binding Agreement.
(a) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation, reorganization or otherwise,
including, without limitation, any successor due to a Change in Control) to the
business or assets of the Company, by agreement in form and substance reasonably
satisfactory to the Executive, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent the Company would be
required to perform if no such succession had taken place. This Agreement will
be binding upon and inure to the benefit of the Company and any successor to the
Company, including, without limitation, any persons directly or indirectly
acquiring the business or assets of the Company in a transaction constituting a
Change in Control (and such successor shall thereafter be deemed the "Company"
for the purpose of this Agreement), but will not otherwise be assignable,
transferable or delegable by the Company.
(b) This Agreement will inure to the benefit of and be enforceable
by the Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees and legatees.
(c) This Agreement is personal in nature and neither of the
parties hereto shall, without the consent of the other, assign, transfer or
delegate this Agreement or any rights or obligations hereunder except as
expressly provided in Sections 4(a) and 4(b). Without limiting the generality or
effect of the foregoing, the Executive's right to receive payments hereunder
will not be assignable, transferable or delegable, whether by pledge, creation
of a
4
5
security interest, or otherwise, other than by a transfer by Executive's will or
by the laws of descent and distribution and, in the event of any attempted
assignment or transfer contrary to this Section 4(c), the Company shall have no
liability to pay any amount so attempted to be assigned, transferred or
delegated.
6. Notices. For all purposes of this Agreement, all communications,
including without limitation notices, consents, requests or approvals, required
or permitted to be given hereunder will be in writing and will be deemed to have
been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof orally confirmed), or five business days
after having been mailed by United States registered or certified mail, return
receipt requested, postage prepaid, or three business days after having been
sent by a nationally recognized overnight courier service such as FedEx, UPS, or
DHL, addressed to the Company (to the attention of the Secretary of the Company)
at its principal executive office and to the Executive at his principal
residence, or to such other address as any party may have furnished to the other
in writing and in accordance herewith, except that notices of changes of address
shall be effective only upon receipt.
7. Validity. If any provision of this Agreement or the application of
any provision hereof to any person or circumstances is held invalid,
unenforceable or otherwise illegal, the remainder of this Agreement and the
application of such provision to any other person or circumstances will not be
affected, and the provision so held to be invalid, unenforceable or otherwise
illegal will be reformed to the extent (and only to the extent) necessary to
make it enforceable, valid or legal.
8. Governing Law; Jurisdiction. The laws of the state of Utah shall
govern the interpretation, validity and performance of the terms of this
Agreement, regardless of the law that might be applied under principles of
conflicts of law. Any suit, action or proceeding against Executive, with respect
to this Agreement, or any judgment entered by any court in respect of any of
such, may be brought in any court of competent jurisdiction in the State of
Utah, and Executive hereby submits to the jurisdiction of such courts for the
purpose of any such suit, action, proceeding or judgment.
9. Confidentiality. Executive agrees that, without the prior written
consent of the Chief Executive Officer of the Company or except as required by
law, Executive will not disclose to any person the existence or contents of this
Agreement or that discussions or negotiations are taking place concerning a
possible merger, sale or similar transaction between the Company and a third
party or any of the terms, conditions or other facts with respect to any such
possible transaction, including the status thereof.
10. Miscellaneous. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto or compliance with
any condition or provision of this Agreement to be performed by such other party
will be deemed a waiver of similar or dissimilar provisions or conditions at the
same or at any prior or subsequent time. This Agreement constitutes the
5
6
entire agreement of the parties with respect to the subject matter hereof and
supersedes any and all prior agreements of the parties with respect to such
subject matter. No agreements or representations, oral or otherwise, expressed
or implied with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement. References to
Sections are to references to Sections of this Agreement.
11. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same agreement.
[signature page follows]
6
7
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the date first above written.
WEIDER NUTRITION GROUP, INC.
By:______________________________________
Title:___________________________________
_________________________________________
(Executive)
7