DEL MONTE FOODS COMPANY
2002 STOCK INCENTIVE PLAN
STAND-ALONE STOCK APPRECIATION RIGHT AGREEMENT

     Del Monte Foods Company (the “Company”) hereby grants you,
___________________ (the “Participant”), a stand-alone stock appreciation right
(“SAR”) under the Company’s 2002 Stock Incentive Plan (the “Plan”), in order to
encourage you to continue to contribute to the Company’s growth and success. The
SAR consists of the right to receive shares of common stock of the Company,
$0.01 par value per share (the “Common Stock”), in an amount whose Fair Market
Value (as defined in the Plan) is equal, with respect to the number of shares
specified below (the “Shares”), to the excess of (i) the Fair Market Value of
Common Stock on the date or dates upon which the Participant converts this SAR
or any portion thereof to Common Stock (the “Conversion Date(s)”), over (ii) the
Conversion Price.

     The SAR has been issued to the Participant hereunder as a separate
incentive in connection with his or her service to the Company and not in lieu
of any salary or other compensation for his or her services. The Compensation
Committee of the Company’s Board of Directors (“Board”), in its sole discretion,
shall have the ability to substitute, without receiving Participant’s
permission, options to purchase Common Stock for this SAR or any outstanding
portion thereof; provided, (i) the vesting and expiration terms of any such
substituted option shall be the same as set forth below, (ii) the exercise price
of any such substituted option shall be equal to the Conversion Price, and
(iii) the exercisability and transferability terms of any such substituted
option, shall be as set forth in the Plan and in compliance with applicable law;
provided further that, the Compensation Committee of the Board also shall have
the ability to revert, without receiving Participant’s permission, any unvested
substituted option to purchase Common Stock back to an equivalent SAR, subject
to the terms and conditions set forth herein.

     The date of this Agreement is ___________________ (the “Grant Date”). The
latest date the SAR granted hereunder will expire is the ten (10) year
anniversary of the Grant Date (the “Expiration Date”). However, as provided in
Appendix A (attached hereto), the SAR may expire earlier than the Expiration
Date. Subject to the provisions of Appendix A, the Plan, the Del Monte
Corporation Executive Severance Policy (the “Severance Policy”) (if applicable),
and any applicable employment agreement, the principal features of the SAR are
as follows:

     
Number of Shares
covered by SAR:
  Conversion Price per Share:  
Scheduled Vesting Dates:
  Number of Shares:  

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    Event TriggeringTermination of SAR:
  Maximum Time to Convert SAR into
Common Stock After Triggering Event:*
 
Termination of Employment for Cause
No conversion available
Termination of Employment without Cause or
Resignation other than Retirement or Disability
90 days as to vested portion; Unvested portion
cannot be converted†
Termination of Employment due to Retirement
Expiration Date as to vested portion; Unvested
portion cannot be converted
Termination of Employment due to Disability or death
Expiration Date
Death within 3 months after Termination of Employment
without Cause
Expiration Date or 1 year from date of death,
whichever is sooner, as to vested portion;
Unvested portion cannot be converted

 

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*      However, in no event may this SAR be converted into Common Stock after
the Expiration Date.

†      Provided that, for Participants covered under the Severance Policy or who
are parties to an employment agreement with the Company or a Subsidiary of the
Company, in the case of termination of employment without Cause or resignation
for Good Reason (as defined in the Severance Policy or employment agreement, as
applicable), (i) with respect to Participants who are covered under the
Severance Policy, this SAR or any substituted option will be treated under such
policy; and (ii) with respect to Participants who are not covered under the
Severance Policy but who are parties to an employment agreement with the Company
or a Subsidiary of the Company, this SAR or any substituted option will be
treated under such employment agreement. With respect to all other Participants,
this SAR or any substituted option will be treated as described in Paragraph 6
of Appendix A.

     Your signature below indicates your agreement and understanding that this
SAR is subject to all of the terms and conditions contained in Appendix A and
the Plan. For example, important additional information on vesting and
termination of this SAR is contained in Paragraphs 4, 5 and 6 of Appendix A.
ACCORDINGLY, PLEASE BE SURE TO READ ALL OF APPENDIX A, WHICH CONTAINS ADDITIONAL
SPECIFIC TERMS AND CONDITIONS OF THIS SAR.

     
DEL MONTE FOODS COMPANY
  PARTICIPANT      
By
   

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     Title: Vice President, Human Resources
   

 

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APPENDIX A
TERMS AND CONDITIONS OF STAND-ALONE STOCK APPRECIATION RIGHT

     1.     Grant of SAR. The Company hereby grants to the Participant under the
Plan, as a separate incentive in connection with his or her employment and not
in lieu of any salary or other compensation for his or her services, a SAR
subject to the terms and conditions set forth in this Agreement and the Plan,
with respect to all or any part of an aggregate of _____________ Shares.

     2.     Conversion Price. The conversion price per share for this SAR (the
“Conversion Price”) shall be ___________ .

     3.     Number of Shares. The number of Shares specified in Paragraph 1
above, and/or the Conversion Price specified in Paragraph 2 above, are subject
to adjustment by the Compensation Committee of the Board of Directors of the
Company (the “Committee”) (subject to any required stockholder approval) in the
event of any increase or decrease in the number of issued shares of Common Stock
resulting from a subdivision or consolidation of Common Stock or the payment of
a stock dividend on Common Stock, or any other increase or decrease in the
number of shares of Common Stock effected without receipt or payment of
consideration by the Company, or change in the capitalization of the Company.
Further, the Committee in its discretion will determine whether the SAR granted
pursuant to this Agreement will, in the context of a Change of Control or any
other transaction, be converted into a comparable SAR of a successor entity or
redeemed for payment in cash or kind or both.

     4.     Vesting Schedule. Subject to earlier termination as described in
Paragraph 6 below, and subject to treatment under the Severance Policy or an
employment agreement (if applicable) as described in Paragraph 6 below, the SAR
granted under this Agreement is scheduled to vest as to the number of Shares and
on the dates shown on the first page of this Agreement. Notwithstanding the
foregoing, this SAR will vest immediately as to one hundred percent (100%) of
the Shares upon the occurrence of a Change of Control. The Committee in its
discretion will determine whether the SAR will vest immediately in the event of
other transactions including, without limitation, a liquidation or dissolution
of the Company; provided that this SAR or any substituted option in no case will
be convertible into Common Stock, or exercisable if a substituted option, after
the Expiration Date.

     5.     Substitution of SAR. The Committee shall have the authority to
substitute, without receiving Participant’s permission, options to purchase
Common Stock for this SAR in the event that the Committee determines, in its
sole discretion, that such substitution is necessary or desirable based on legal
and/or accounting requirements applicable to the Company or the Participant;
provided that, (i) the vesting and expiration terms of any such substituted
option shall be the same as set forth above, (ii) the exercise price of any such
substituted option shall be equal to the Conversion Price, and (iii) the
exercisability and transferability terms of any such substituted option, shall
be as set forth in the Plan and in compliance with applicable law; provided
further that, the Committee also shall have the ability to revert, without
receiving Participant’s permission, any unvested substituted option to purchase
Common Stock back to an equivalent SAR, in the event that the Committee
determines, in its sole discretion, that such reversion is necessary or
desirable based on legal and/or accounting requirements applicable to the
Company or the Participant.

     6.     Termination of SAR. In the event of Participant’s termination of
employment with the Company (or, in each case described in this Paragraph 6, a
Subsidiary of the Company) for Cause, this SAR will expire and be cancelled upon
such termination. In the event of Participant’s termination of employment
without Cause, or in the event Participant resigns his or her employment for a
reason other than Disability or retirement, this SAR will remain convertible
into Common Stock to the extent vested as of the date of termination until the
expiration of ninety (90) days after such termination, on which date it will
expire; to the extent not vested as of the date of termination, this SAR will
expire at the close of business on the date of termination. In the event of
Participant’s termination of employment as a result of retirement under any
retirement plan of the Company or a Subsidiary of the Company (within the
meaning of Section 424(f) of the Code), this SAR will remain convertible into
Common Stock to the extent vested as of the date of termination until the
Expiration Date; to the extent not vested as of the date of termination, this
SAR will expire at the close of business on the date of termination. In the
event of

 

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Participant’s termination of employment on account of Disability or death of the
Participant, this SAR will remain convertible into Common Stock with respect to
all Shares, whether or not vested as to such Shares as of the date of
termination, until the Expiration Date. In the event Participant dies within
three (3) months following his or her termination of employment without Cause,
this SAR will remain convertible into Common Stock to the extent vested as of
the date of termination until the Expiration Date or, if sooner, one (1) year
from the date of Participant’s death; to the extent not vested as of the date of
termination of employment, this SAR will expire at the close of business on the
date of termination of employment. Any substituted option will be subject to the
cancellation terms set forth in Section 6(c)(7) of the Plan.

     7.     Treatment under Severance Policy or Employment Contract.
Notwithstanding any provision of the foregoing Paragraph 6, for Participants
covered under the Del Monte Corporation Executive Severance Policy (“Severance
Policy”) or who are parties to an employment agreement with the Company or a
Subsidiary of the Company, in the case of termination of employment without
Cause or resignation for Good Reason (as defined in the Severance Policy or
employment agreement, as applicable), (i) with respect to Participants who are
covered under the Severance Policy, this SAR or any substituted option will be
treated under such policy; and (ii) with respect to Participants who are not
covered under the Severance Policy but who are parties to an employment
agreement with the Company or a Subsidiary of the Company, this SAR or any
substituted option will be treated under such employment agreement; provided
that this SAR or any substituted option in no case will be convertible into
Common Stock, or exercisable if a substituted option, after the Expiration Date.

     8.     Persons Eligible to Convert SAR. This SAR shall be convertible into
Common Stock during the Participant’s lifetime by the Participant or by a
transferee to whom the SAR or the right to convert the SAR into Common Stock has
been transferred pursuant to Paragraph 9 or Paragraph 15 below.

     9.     Death of Participant. The Committee, in its discretion, may permit
the Participant to designate a beneficiary or beneficiaries to whom any vested
but unconverted portion of this SAR shall be transferred. In the absence of such
designation, such vested but unconverted portion will be transferred to the
Participant’s estate. No such transfer of the SAR, or the right to convert the
SAR or any portion thereof into Common Stock, will be effective to bind the
Company unless the Committee shall have been furnished with written notice
thereof and with a copy of the will and/or such evidence as the Committee deems
necessary to establish the validity of such transfer or right to convert, and an
agreement by the transferee, administrator, or executor (as applicable) to
comply with all the terms of this Agreement that are or would have been
applicable to the Participant and to be bound by the acknowledgements made by
the Participant in connection with this grant.

     10.     Conversion of SAR. This SAR may be converted into Common Stock by
the person then entitled to do so as to any vested portion by giving written
notice of conversion to the attention of the Company’s Treasurer, specifying the
number of full Shares with respect to which the SAR is being converted and the
effective date of the proposed conversion. No partial conversion of this SAR may
be for less than ten (10) Shares or multiples thereof.

     11.     Deferral of Effectiveness of Conversion. The Company may, in its
discretion, defer the effectiveness of any conversion of this SAR in order to
allow the issuance of shares of Common Stock to be made pursuant to registration
or an exemption from registration or other methods for compliance available
under federal or state securities laws. In the case of such deferral, the
Participant shall have such rights with respect to this SAR as are set forth in
the Plan. Notwithstanding the foregoing, the Company is under no obligation to
effect the registration pursuant to federal or state securities laws of any
shares of Common Stock to be issued pursuant to this SAR.

     12.     No Rights of Stockholder. Neither the Participant (nor any
beneficiary or transferee) shall be or have any of the rights or privileges of a
stockholder of the Company in respect of any of the shares of Common Stock
issuable pursuant to the conversion of this SAR, unless and until the date of
the issuance of a stock certificate with respect to such shares of Common Stock.
Except as expressly provided in Paragraph 3 above or in Section 10 of the Plan,
no adjustment to this SAR shall be made for

 

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dividends or other rights for which the record date occurs prior to the date
such certificates representing such shares of Common Stock are issued.

     13.     No Effect on Employment. The Participant’s employment with the
Company and any Subsidiary of the Company is on an at-will basis only.
Accordingly, subject to any written, express employment contract with the
Participant, nothing in this Agreement or the Plan shall confer upon the
Participant any right to continue to be employed by the Company or any
Subsidiary of the Company, or shall interfere with or restrict in any way the
rights of the Company or any Subsidiary of the Company, which are hereby
expressly reserved, to terminate the employment of Participant at any time for
any lawful reason whatsoever or for no reason, with or without Cause and with or
without notice. Such reservation of rights can be modified only in an express
written contract executed by a duly authorized officer of the Company.

     14.     Address for Notices. Any notice to be given to the Company under
the terms of this Agreement shall be addressed to the Company, in care of its
Treasury Department, at One Market @ the Landmark, San Francisco, CA 94105, or
at such other address as the Company may hereafter designate in writing.

     15.     Transferability. Except as provided in Paragraph 9, above, this SAR
may be transferred solely as provided in Section 6(c)(6) of the Plan.

     16.     Other Benefits. Except as provided below, nothing contained in this
Agreement shall affect the Participant’s right to participate in and receive
benefits under and in accordance with the then current provisions of any
pension, insurance or other Participant welfare plan or program of the Company
or any Subsidiary of the Company.

     17.     Maximum Term of SAR. Notwithstanding any other provision of this
Agreement, this SAR is not convertible into Common Stock after the Expiration
Date.

     18.     Binding Agreement. Subject to the limitation on the transferability
of this SAR contained herein, this Agreement shall be binding upon and inure to
the benefit of the heirs, legatees, legal representatives, successors and
assigns of the parties hereto.

     19.     Plan Governs. This Agreement is subject to all of the terms and
provisions of the Plan. In the event of a conflict between one or more
provisions of this Agreement and one or more provisions of the Plan, the
provisions of the Plan shall govern. Unless otherwise specified, capitalized
terms and phrases used and not defined in this Agreement shall have the meaning
set forth in the Plan.

     20.     Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, without reference to its
principles of conflicts of law.

     21.     Committee Authority. The Committee shall have all discretion,
power, and authority to interpret the Plan and this Agreement and to adopt such
rules for the administration, interpretation and application of the Plan as are
consistent therewith. All actions taken and all interpretations and
determinations made by the Committee in good faith shall be final and binding
upon the Participant, the Company and all other interested persons, and shall be
given the maximum deference permitted by law. No member of the Committee shall
be personally liable for any action, determination or interpretation made in
good faith with respect to the Plan or this Agreement.

     22.     Captions. The captions provided herein are for convenience only and
are not to serve as a basis for the interpretation or construction of this
Agreement.

     23.     Agreement Severable. In the event that any provision in this
Agreement shall be held invalid or unenforceable, such provision shall be
severable from, and such invalidity or unenforceability shall not be construed
to have any effect on, the remaining provisions of this Agreement.

     24.     Definitions. For purposes of this Agreement, the following words
and phrases shall have the following meanings unless a different meaning is
plainly required by the context:

  (a)   “Cause,” when used in connection with the termination of an
Participant’s employment with the Company or any Subsidiary of the Company,
shall mean (i)

 

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      a material breach by the Participant of the terms of his or her employment
agreement, if any; (ii) any act of theft, misappropriation, embezzlement,
intentional fraud or similar conduct by the Participant involving the Company or
any affiliate; (iii) the conviction or the plea of nolo contendere or the
equivalent in respect of a felony involving an act of dishonesty, moral
turpitude, deceit or fraud by the Participant; (iv) any damage of a material
nature to the business or property of the Company or any affiliate caused by the
Participant’s willful or grossly negligent conduct; or (v) the Participant’s
failure to act in accordance with any specific lawful instructions given to the
Participant in connection with the performance of his or her duties for the
Company or any affiliate. Notwithstanding the foregoing provisions of this
Paragraph 24(a), “Cause,” when used in connection with the termination of the
employment with the Company of a Participant who at the time of such termination
is a party to a written employment or retention agreement with the Company or
any Subsidiary of the Company, shall have the meaning assigned to such term in
such agreement.

  (b)   “Change of Control” shall mean the occurrence of one or more of the
following events:

  (i)   any sale, lease, exchange or other transfer (in one transaction or a
series of related transactions) of all or substantially all of the assets of the
Company to any individual, partnership, corporation, limited liability company,
unincorporated organization, trust or joint venture, or a governmental agency or
political subdivision thereof (a “Person”) or group of related Persons for
purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (a
“Group”), together with any Affiliates (as defined below) thereof;

  (ii)   the approval by the holders of any and all shares, interests,
participations or other equivalents (however designated and whether or not
voting) of corporate stock, including each class of common stock and preferred
stock, of the Company (“Capital Stock”) of any plan or proposal for the
liquidation or dissolution of the Company;

  (iii)   any Person or Group shall become the owner, directly or indirectly,
beneficially or of record, of shares representing more than 40% of the aggregate
ordinary voting power represented by the issued and outstanding Capital Stock
(the “Voting Stock”) of the Company;

  (iv)   the replacement of a majority of the Board of Directors of the Company
(the “Board of Directors”) over a two-year period commencing after the Effective
Date of the Plan, from the directors who constituted the Board of Directors at
the beginning of such period, and such replacement shall not have been approved
by a vote of at least a majority of the Board of Directors then still in office
who either were members of such Board of Directors at the beginning of such
period (any such individual who was a director at the beginning of such period
or is so approved, nominated, or designated being referred to herein as an
“Incumbent Director”) or whose election as a member of such Board of Directors
was previously approved; provided, however, that no individual shall be
considered an Incumbent Director if the individual initially assumed office as a
result of either an actual or threatened “Election Contest” (as described in
Rule 14a-11 promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board of Directors (a

 

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      “Proxy Contest”) including by reason of any agreement intended to avoid or
settle any Election Contest or Proxy Contest; or

  (v)   a merger or consolidation involving the Company in which the Company is
not the surviving corporation, or a merger or consolidation involving the
Company in which the Company is the surviving corporation but the holders of
shares of Common Stock receive securities of another corporation and/or other
property, including cash, or any other similar transaction.

      For purposes of this Paragraph 24(b), “Affiliate” shall mean, with respect
to any specified Person, any other Person who directly or indirectly through one
or more intermediaries controls, or is controlled by, or is under common control
with, such specified Person. The term “control” means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by
contract or otherwise; and the terms “controlling” or “controlled” have meanings
correlative of the foregoing.

  (c)   “Disability” shall mean physical or mental disability as a result of
which the Participant is unable to perform the essential functions of his or her
position, even with reasonable accommodation, for six (6) consecutive months.
Any dispute as to whether or not the Participant is so disabled shall be
resolved by a physician reasonably acceptable to the Participant and the Company
(or a Subsidiary of the Company, as applicable) whose determination shall be
final and binding upon both the Participant and the Company (or any Subsidiary
of the Company). Notwithstanding the foregoing provisions of this
Paragraph 24(c), “Disability,” when used in connection with the termination of
the employment with the Company of a Participant who at the time of such
termination is a party to a written employment or retention agreement with the
Company or any Subsidiary of the Company, shall have the meaning assigned to
such term in such agreement.

     25.     Modifications to the Agreement. This Agreement constitutes the
entire understanding of the parties on the subjects covered. The Participant
expressly warrants that he or she is not executing this Agreement in reliance on
any promises, representations, or inducements other than those contained herein.
Modifications to this Agreement or the Plan can be made only in an express
written contract executed by a duly authorized officer of the Company.