EXHIBIT 10.2

 

SUPERVALU INC.

2002 STOCK PLAN

 

RESTORATION STOCK OPTION AGREEMENT

 

This Restoration Stock Option Agreement is made and entered into as of the Grant
Date listed below, by and between SUPERVALU INC. (the “Company”) and the
individual whose name and address appears in the signature space below
(“Optionee”).

 

The Company has established the 2002 Stock Plan, as amended (the “Plan”), under
which certain key employees of the Company may be granted restoration stock
options (each a “Restoration Option”) to purchase shares of the Company’s common
stock, par value $1.00 per share (each a “Share”), in consideration for
tendering Shares in payment for the exercise price and withholding tax, if
applicable, due on the exercise of a stock option previously granted by the
Company. Optionee has tendered Shares in payment of the exercise price and
withholding tax, if applicable, of a stock option and has been granted a
Restoration Option to purchase additional shares of common stock of the Company
as follows:

 

In consideration of the foregoing, the Company and Optionee hereby agree as
follows:

 

1. Grant. The Company hereby grants Optionee a Restoration Option to purchase
the number of Shares set forth in the table below, effective as of the Grant
Date indicated therein. The Restoration Option shall be a non-qualified, having
an exercise price and expiration date as indicated in the table below. Subject
to the Restoration Stock Option Terms and Conditions attached hereto (the “Terms
and Conditions”), the Restoration Option is immediately exercisable, with
respect to all of the Shares subject thereto, as of the Grant Date.

 

Grant

No.

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Grant

Date

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Number of

Shares

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Type of

Option

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Exercise

Price

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Expiration

Date

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2. Acceptance of Restoration Option and Terms and Conditions. The Restoration
Option is governed by and subject to the Terms and Conditions attached hereto
and the provisions of the Plan. Optionee hereby acknowledges receipt of the
Terms and Conditions, and the Plan, and represents that he or she has read and
understands same. Optionee hereby accepts the Restoration Option and agrees to
be bound by all of the Terms and Conditions and the provisions of the Plan.

 

In witness whereof, this Restoration Stock Option Agreement has been executed by
the Company and Optionee as of the Grant Date listed above.

 

SUPERVALU INC.

  OPTIONEE:

By:

 

 

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SUPERVALU INC.

2002 STOCK PLAN

 

RESTORATION STOCK OPTION TERMS & CONDITIONS

(FOR EXECUTIVE OFFICERS)

 

These Restoration Stock Option Terms and Conditions (“Terms and Conditions”)
apply to the Restoration Option granted under the SUPERVALU INC. 2002 Stock
Plan, pursuant to the Restoration Stock Option Agreement to which this document
is attached. Capitalized terms that are used in this document, but are not
defined, shall have the meanings ascribed to them in the Plan or the Restoration
Stock Option Agreement.

 

1. Vesting and Exercisability. The Restoration Option shall vest as follows:

 

  a) As of the Grant Date, one hundred percent (100%) of the Restoration Option
shall immediately vest.

 

  b) The Restoration Option may be exercised at any time, or from time to time,
as to any or all full shares.

 

  c) The term of the Restoration Option shall expire at the close of business on
the expiration date set forth in the attached Agreement (the “Expiration Date”)
or such shorter period as is prescribed in Section 7.

 

2. Manner of Exercise. Except as provided in Section 7 below, you cannot
exercise the Restoration Option unless at the time of exercise you are an
employee of the Company or an Affiliate. Prior to your death, only you may
exercise the Restoration Option. You may exercise the Restoration Option as
follows:

 

  a) By delivering a “Notice of Exercise of Stock Restoration Option” to the
Company at its principal office, attention: Corporate Secretary, stating the
number of Shares being purchased and accompanied by payment of the full purchase
price for such Shares (determined by multiplying the Exercise Price by the
number of Shares to be purchased). [Note: In the event the Restoration Option is
exercised by any person other than you pursuant to any of the provisions of
Section 7 below, the Notice must be accompanied by appropriate proof of such
person’s right to exercise the Restoration Option.]; or

 

  b) By entering an order to exercise the Restoration Option using E*TRADE’s
OptionsLink website.

 

3. Method of Payment. The full purchase price for the Shares to be purchased
upon exercise of the Restoration Option must be paid as follows:

 

  a) By delivering directly to the Company, cash or its equivalent payable to
the Company;

 

  b) By delivering indirectly to the Company, cash or its equivalent payable to
the Company through E*TRADE’s OptionsLink website; or

 

  c) By delivering Shares having a Fair Market Value as of the Exercise Date
equal to the purchase price (commonly known as a “Stock Swap”); or

 

  d) By delivering the full purchase price in a combination of cash and shares.

 

4. Delivery of Shares. You shall not have any of the rights of a stockholder
with respect to any Shares subject to the Restoration Option until such Shares
are purchased by you upon exercise of the Restoration Option. Such Shares shall
then be issued and delivered to you by the Company as follows:

 

  a) In the form of a stock certificate registered in your name or your name and
the name of another adult person (21 years of age or older) as joint tenants,
and mailed to your address; or

 

  b) In “book entry” form, i.e. registered with the Company’s stock transfer
agent, in your name or your name and the name of another adult person (21 years
of age or older) as joint tenants, and sent by electronic delivery to your
brokerage account.

 

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5. Withholding Taxes. You are responsible for the payment of any federal, state,
local or other taxes that are required to be withheld by the Company upon
exercise of the Restoration Option and you must promptly remit such taxes to the
Company. You may elect to remit these taxes by:

 

  a) Delivering directly to the Company, cash or its equivalent payable to the
Company;

 

  b) Delivering indirectly to the Company, cash or its equivalent payable to the
Company through E*TRADE’s Restoration OptionsLink website;

 

  c) Having the Company withhold a portion of the Shares to be issued upon
exercise of the Restoration Option having a Fair Market Value equal to the
amount of federal and state income tax required to be withheld upon such
exercise (commonly referred to as a “Tax Swap” or “Stock for Tax”); or

 

  d) Delivering Shares to the Company, other than the Shares issuable upon
exercise of the Restoration Option, having a Fair Market Value equal to such
taxes. [Note: In addition to delivering Shares to satisfy required tax
withholding obligations, you may also elect to deliver additional Shares to the
Company, other than the Shares issuable upon exercise of the Restoration Option,
having a Fair Market Value equal to the amount of any additional federal or
state income taxes imposed on you in connection with the exercise of the
Restoration Option, provided such Shares have been held by you for a minimum of
six (6) months.]

 

6. Transferability. Unless otherwise determined by the Committee, the
Restoration Option shall not be transferable other than by will or the laws of
descent and distribution. More particularly, the Restoration Option may not be
assigned, transferred, pledged or hypothecated in any way (whether by operation
of law or otherwise) and shall not be subject to execution, attachment or
similar process. Any attempted assignment, transfer, pledge, hypothecation or
other disposition of the Restoration Option contrary to these provisions, or the
levy of an execution, attachment or similar process upon the Restoration Option,
shall be void.

 

You may designate a beneficiary or beneficiaries to exercise your rights with
respect to the Restoration Option upon your death. In the absence of any such
designation, benefits remaining unpaid at your death shall be paid to your
estate.

 

7. Effect of Termination of Employment. Following the termination of your
employment with the Company or an Affiliate for any of the reasons set forth
below, your right to exercise the Restoration Option, as well as that of your
beneficiary or beneficiaries, shall be as follows:

 

  a) Voluntary or Involuntary. In the event your employment is terminated
voluntarily or involuntarily for any reason other than retirement, death or
permanent disability, you may exercise the Restoration Option prior to its
Expiration Date, at any time within a period of up to two (2) years after such
termination of employment. However, the Committee may, in its sole and absolute
discretion, except in the case of the termination of your employment following
the occurrence of a Change of Control as defined in Section 12 below, during a
period of seventy-five (75) days after such termination of employment and
following ten (10) days’ written notice to you, reduce the period of time during
which the Restoration Option may be exercised to any period of time designated
by the Committee, provided such period is not less than ninety (90) days
following termination of your employment.

 

  b) Retirement. You shall be deemed to have retired, solely for purposes of
this Agreement, in the event that your employment terminates for any reason
other than death or disability and you are at least 55 years of age.

 

  (i) In the event you retire and you have completed ten (10) or more years of
service with the Company or an Affiliate, you may exercise the Option at any
time prior to its Expiration Date, to the full extent of the Shares covered by
the Option that were not previously purchased.

 

  (ii) In the event you retire and you have completed less than ten (10) years
of service with the Company or an Affiliate, you may exercise the Option prior
to its Expiration Date, at any time within a period of up to two (2) years after
the date of your retirement, to the full extent of the Shares covered by the
Option that were not previously purchased.

 

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  c) Death Prior to Age 55. In the event your death occurs before you attain the
age of fifty-five (55), while you are employed by the Company or an Affiliate,
or within three (3) months after the termination of your employment, the
Restoration Option may be exercised prior to its Expiration Date, by your
beneficiary(ies), or a legatee(s) under your last will, or your personal
representative(s) or the distributee(s) of your estate, to the full extent of
the Shares covered by the Restoration Option that were not previously purchased:

 

  (i) At any time within a period of up to two (2) years after your death if
such occurs while you are employed, or

 

  (ii) At any time within a period of up to two (2) years following the
termination of your employment if your death occurs within three (3) months
thereafter.

 

  d) Death After Age 55. In the event your death occurs after you attain the age
of fifty-five (55), while you are employed by the Company or an Affiliate, or
within three (3) months after the termination of your employment, the
Restoration Option may be exercised prior to its Expiration Date, by your
beneficiary(ies), or a legatee(s) under your last will, or your personal
representative(s) or the distributee(s) of your estate, to the full extent of
the Shares covered by the Restoration Option that were not previously purchased:

 

  (i) At any time, if you have completed ten (10) or more years of service with
the Company or an Affiliate; or

 

  (ii) If you have completed less than ten (10) years of service with the
Company or an Affiliate, then at any time within a period of up to two (2) years
after the date of your death if such occurs while you are employed, or within a
period of up to two (2) years after the date of termination of your employment
if your death occurs within three (3) months thereafter.

 

  e) Disability Prior to Age 55. In the event your employment terminates before
you attain the age of fifty-five (55), as a result of a permanent disability,
the Restoration Option may be exercised prior to its Expiration Date, by you or
by your personal representative(s), at any time within a period of up to two (2)
years after your employment terminates due to such permanent disability, to the
full extent of the Shares covered by the Restoration Option that were not
previously purchased.

 

You shall be considered permanently disabled if you suffer from a medically
determinable physical or mental impairment that renders you incapable of
performing any substantial gainful employment, and is evidenced by a
certification to such effect by a doctor of medicine approved by the Company. In
lieu of such certification, the Company shall accept, as proof of permanent
disability, your eligibility for long-term disability payments under the
applicable Long-Term Disability Plan of the Company.

 

  f) Disability After Age 55. In the event your employment terminates as a
result of a permanent disability after you attain the age of fifty-five (55),
the Restoration Option may be exercised prior to its Expiration Date, by you or
by your personal representative(s), to the full extent of the Shares covered by
the Restoration Option that were not previously purchased:

 

  (i) At any time, if you have completed ten (10) or more years of service with
the Company or an Affiliate; or

 

  (ii) If you have completed less than ten (10) years of service with the
Company or an Affiliate, then at any time within a period of two (2) years after
your employment terminates due to such permanent disability.

 

You shall be considered permanently disabled if you suffer from a medically
determinable physical or mental impairment that renders you incapable of
performing any substantial gainful employment, and is evidenced by a
certification to such effect by a doctor of medicine approved by the Company. In
lieu of such certification, the Company shall accept, as proof of permanent
disability, your eligibility for long-term disability payments under the
applicable Long-Term Disability Plan of the Company.

 

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  g) Change in Duties/Leave of Absence. The Restoration Option shall not be
affected by any change of your duties or position or by a temporary leave of
absence approved by the Company, so long as you continue to be an employee of
the Company or of an Affiliate.

 

8. Repurchase Rights. If you exercise the Restoration Option within six (6)
months prior to or three (3) months after the date your employment with the
Company or an Affiliate terminates for any reason, whether voluntary or
involuntary, with or without cause (except as a result of death, permanent
disability or retirement pursuant to the Company’s retirement plans then in
effect), the Company shall have the right and Restoration Option to repurchase
from you, that number of Shares which is equal to the number you purchased upon
such exercise(s) within such time periods, and you agree to sell such Shares to
the Company.

 

The Company may exercise its repurchase rights by depositing in the United
States mail a written notice addressed to you at the latest mailing address for
you on the records of the Company (i) within thirty (30) days following the
termination of your employment for the repurchase of Shares purchased prior to
such termination, or (ii) within thirty (30) days after any exercise of the
Restoration Option for the repurchase of Shares purchased after your termination
of employment. Within thirty (30) days after the mailing of such notice, you
shall deliver to the Company the number of Shares the Company has elected to
repurchase and the Company shall pay to you in cash, as the repurchase price for
such Shares upon their delivery, an amount which shall be equal to the purchase
price paid by you for the Shares. If you have disposed of the Shares, then in
lieu of delivering an equivalent number of Shares to the Company, you must pay
to the Company the amount of gain realized by you from the disposition of the
Shares exclusive of any taxes due and payable or commissions or fees arising
from such disposition.

 

If the Company exercises its repurchase Restoration Option prior to the actual
issuance and delivery to you of any Shares pursuant to the exercise of the
Restoration Option, no Shares need be issued or delivered. In lieu thereof, the
Company shall return to you the purchase price you tendered upon the exercise of
the Restoration Option to the extent that it was actually received from you by
the Company.

 

Following the occurrence of a Change of Control as defined in Section 12 below,
the Company shall have no right to exercise the repurchase rights set forth in
this Section.

 

9. Employee Covenants.

 

  a) Non-competition Covenant. You agree that you will not be an employee,
trustee, principal, agent, consultant, partner, director or substantial
stockholder of any company or business that is engaged in the same business in
which you were employed by the Company or any of its Affiliates. This paragraph
shall not apply in the event of a Change in Control as described in Section 12
below.

 

  b) Confidential Information Covenant. You acknowledge that you will have
access to and gain knowledge of highly confidential and proprietary information
and trade secrets pertaining to the Company, its Affiliates, customers,
suppliers, joint ventures, licensors, licensees, distributors and other persons
and entities with whom the Company does business (“Confidential Information”) in
the course of your employment with the Company or any of its Affiliates. You
agree to hold all Confidential Information in a fiduciary capacity for the sole
benefit of the Company and/or its Affiliates. You further agree that you will
not, without the prior written consent of the Company or as required by your
duties as an employee of the Company or any of its Affiliates, in any way
divulge or disclose any Confidential Information. All Confidential Information,
including all copies, notes and replications thereof will remain the sole
property of the Company and/or its Affiliates, and must be returned to the
Company immediately upon your termination of employment.

 

  c) Non-solicitation Covenant. You agree that you will not, directly or in
concert with others, have any contact for the purpose of recruiting or
soliciting any employee(s) of the Company or any of its Affiliates to terminate
their employment with the Company or such Affiliate in order to become
associated with another employer. You agree that, with respect to the customers
or accounts of the business unit(s) in which you worked or over which you had
management responsibility, you will not, directly or in concert with others,
have contact with such customers or accounts for the purpose of attempting to
divert any customer’s business or any account from the Company or any of its
Affiliates.

 

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  d) No Disparaging Statements Covenant. You agree that you will not make any
disparaging statements about the Company, its Affiliates, directors, officers,
agents, employees, products, pricing policies or services.

 

  e) Term. You agree that each of the covenants set forth in this Section 10
will continue in effect during your employment with the Company or any of its
Affiliates, and for a period of fifteen (15) months after your employment with
the Company or such Affiliate ends.

 

  f) Remedies for Breach of these Covenants. Should you violate any of the above
covenants, you agree that the Company shall recover from you the monetary loss
resulting from such breach, together with the costs and attorneys fees necessary
to gain such recovery. In addition to monetary relief, you agree that upon your
breach of any covenant in this Section, the Restoration Option, and any other
unexercised Restoration Option or option issued under the Plan or any other
stock option plans of the Company will immediately terminate, and that a court
may order injunctive relief requiring you to stop all actions in violation of
the provisions of this Section.

 

  g) Enforceability of these Covenants. You agree that to the extent that a
court determines that any provision of this Section detailing the covenants set
forth herein is invalid or unenforceable, such provision shall be deleted, but
all remaining provisions shall remain in full force and effect.

 

10. Arbitration. You and the Company agree that any controversy, claim, or
dispute arising out of or relating to the Stock Option Agreement or the breach
of any of these Stock Option Terms and Conditions, or arising out of or relating
to your employment relationship with the Company or any of its Affiliates, or
the termination of such relationship, shall be resolved by binding arbitration
before a neutral arbitrator under rules set forth in the Federal Arbitration
Act, except for claims by the Company relating to your breach of any of the
employee covenants set forth in Paragraph 10 above. By way of example only,
claims subject to this agreement to arbitrate include claims litigated under
federal, state and local statutory or common law, such as the Age Discrimination
in Employment Act, Title VII of the Civil Rights Act of 1964, as amended,
including the Civil Rights Act of 1994, the Americans with Disabilities Act, the
law of contract and the law of tort. You and the Company agree that such claims
may be brought in an appropriate administrative forum, but at the point at which
you or the Company seek a judicial forum to resolve the matter, this agreement
for binding arbitration becomes effective, and you and the Company hereby
knowingly and voluntarily waive any right to have any such dispute tried and
adjudicated by a judge or jury. The foregoing not to the contrary, the Company
may seek to enforce the employee covenants set forth in Paragraph 10 above, in
any court of competent jurisdiction.

 

This agreement to arbitrate shall continue in full force and effect despite the
expiration or termination of your Option or your employment relationship with
the Company or any of its Affiliates. You and the Company agree that any award
rendered by the arbitrator shall be final and binding and that judgment upon the
final award may be entered in any court having jurisdiction thereof. The
arbitrator may grant any remedy or relief that the arbitrator deems just and
equitable, including any remedy or relief that would have been available to you,
the Company or any of its Affiliates had the matter been heard in court. All
expenses of the arbitration, including the required travel and other expenses of
the arbitrator and any witnesses, and the costs relating to any proof produced
at the direction of the arbitrator, shall be borne equally by you and the
Company unless otherwise mutually agreed or unless the arbitrator directs
otherwise in the award. The arbitrator’s compensation shall be borne equally by
you and the Company unless otherwise mutually agreed or unless the law provides
otherwise.

 

11. Severability. In the event that any portion of these Terms and Conditions
shall be held to be invalid, the same shall not affect in any respect whatsoever
the validity and enforceability of the remainder of these Terms and Conditions.

 

12. Change of Control. The term “Change of Control”, means any of the following
events:

 

  a) The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the

 

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Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of twenty percent (20%) or more of either (A) the then outstanding shares of
common stock of the Company or (B) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors; provided, however, that for purposes of this subsection
(a), the following share acquisitions shall not constitute a Change of Control;
(A) any acquisition directly from the Company or (B) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company; or

 

  b) The consummation of any merger or other business combination of the
Company, the sale or lease of the Company’s assets or any combination of the
foregoing transactions (each a “Transaction”) other than a Transaction
immediately following which the stockholders of the Company and any trustee or
fiduciary of any Company employee benefit plan immediately prior to the
Transaction own at least sixty percent (60%) of the voting power, directly or
indirectly, of (A) the surviving corporation in any such merger or other
business combination; (B) the purchaser or lessee of the Company’s assets; or
(C) both the surviving corporation and the purchaser or lessee in the event of
any combination of Transactions; or

 

  c) Within any 24-month period, the persons who were directors immediately
before the beginning of such period (the “Incumbent Directors”) shall cease (for
any reason other than death) to constitute at least a majority of the Board of
Directors of the Company or the board of directors of a successor to the
Company. For this purpose, any director who was not a director at the beginning
of such period shall be deemed to be an Incumbent Director if such director was
elected to the Board of Directors of the Company by, or on the recommendation of
or with the approval of, at least three-fourths of the directors who then
qualified as Incumbent Directors (so long as such director was not nominated by
a person who has expressed an intent to effect a Change of Control or engage in
a proxy or other control contest); or.

 

  d) Such other event or transaction as the Board of Directors of the Company
shall determine constitutes a Change of Control.

 

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