Early Retirement Agreement (duggan)

EXHIBIT 10.16


STATE OF NORTH CAROLINA
EARLY RETIREMENT AGREEMENT COUNTY OF MECKLENBURG


THIS EARLY RETIREMENT AGREEMENT (this "Agreement") is entered into as of June 10, 1998 by and between LANCE, INC., a North Carolina corporation (the "Company"), and PETER M. DUGGAN ("Duggan").


STATEMENT OF PURPOSE


Duggan has been employed by the Company since July 18, 1994. On November 11, 1997, the Company and Duggan entered into an Executive Severance Agreement (the "Severance Agreement"), whereby the Company provided Duggan with certain benefits. Duggan currently holds the title of Senior Vice President of the Company.


Duggan has decided to retire from his position with the Company. The Company and Duggan have entered into negotiations with a view toward resolving all issues relating to Duggan's employment with the Company and his retirement from that employment.


As a result of these negotiations, Duggan and the Company have agreed that Duggan will retire and that Duggan and the Company will terminate their relationship on the terms and conditions set forth in this Agreement.


NOW, THEREFORE, in consideration of the Statement of Purpose and the terms and provisions of this Agreement, the parties hereto mutually agree as follows:


1. DEFINITIONS. Capitalized terms used in this Agreement that are not expressly defined herein but are defined in the Severance Agreement have the respective meanings given those terms in the Severance Agreement. In addition, as used herein, the following terms shall have the following meanings:


(a) "Affiliate" with reference to the Company means any Person
that directly or indirectly is controlled by, or is under
common control with, the Company. For purposes of this
definition 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
ownership of voting securities, by contract or otherwise.


(b) "Person" means any individual, corporation, association,
partnership, business trust, joint stock company, limited
liability company, foundation, trust, estate or other entity
or organization of whatever nature.


2


(c) "Effective Date" with reference to this Agreement means the
eighth (8th) day following the execution of this Agreement, if
not a Saturday, Sunday or legal holiday, and if such day is a
Saturday, Sunday or legal holiday, then the first business day
following such eighth (8th) day.


2. RESIGNATION. Duggan hereby retires from employment and resigns from all offices, committees and positions he holds with the Company and its Affiliates, including but not limited to, Senior Vice President of the Company, with said resignation to be effective as of June 10, 1998. Duggan will remain on the payroll through June 26, 1998 and will be considered during such period as being on vacation, and in such connection will have no duties or responsibilities except to consult from time to time with Company officials regarding the transfer of his responsibilities to others. If requested by the Company, Duggan will execute any additional resignation letters, forms or other documents which acknowledge his resignation from such employment, positions, committees and offices.


3. PAYMENTS BY THE COMPANY AND DEFERRAL. The Company agrees to pay or provide Duggan with the following:


(a) Compensation and benefits to which Duggan is otherwise
entitled as an employee of the Company at Duggan's current
rate and status through June 26, 1998, in accordance with the
Company's generally applicable policies and procedures;


(b) Compensation and benefits to which Duggan is otherwise
entitled under the Severance Agreement in accordance with the
terms of the Severance Agreement. For purposes hereof, the
Company acknowledges and agrees that Duggan shall be
considered to have been involuntarily terminated Without
Cause, and shall be due all payments and benefits set forth in
paragraph 4 of the Severance Agreement;


(c) Possession of the Company automobile used by Duggan in
connection with his employment together with conveyance of
title to said automobile promptly following the Effective Date
of this Agreement;


(d) Health benefits for Duggan until December 31, 2000 or his
earlier death under the HMO coverage option under the
Company's group medical plan. During this period, Duggan will
be required to pay those amounts the Company's employees are
customarily required to pay from time to time for such
coverage and will be entitled to obtain at his expense
optional family/dependent medical coverage under the Company's
group medical plan. After December 31, 2000, the Company will
provide to Duggan, at such expense to Duggan as shall then be
required of the Company's retired executives, health benefits
as a "retiree" under such program, if any, as may then be
available to the Company's retired executives and/or their
dependents;


2 3


(e) Duggan has vested interests under Company sponsored 401(k),
Employee Stock Purchase and Incentive Equity plans. Duggan's
vested interest in these plans shall be paid when and as
provided in, and otherwise subject to, the terms, provisions
and conditions of said plans, and nothing in this Agreement
shall modify or override the terms, provisions or conditions,
except that the Company shall request the Compensation/Stock
Option Committee of the Board of Directors of the Company to
amend Duggan's nonqualified stock option agreements to provide
that vested shares may be exercised for three years after June
26, 1998 and to amend Duggan's performance restricted stock
award agreements to provide that the awards be prorated
monthly;


(f) As of June 2, 1998, Duggan has a balance of $14,675 in the
Company sponsored Profit Sharing Retirement Plan, $640 in the
Company sponsored 401(k) Plan and a balance of $7,582 in the
Company sponsored Benefit Restoration Plan. None of these
balances are vested; however, as an additional severance
benefit, the Company will pay Duggan an amount equal to those
unvested balances, plus an amount equal to the income taxes
payable by Duggan on such amount, provided, that the Company
shall not be obligated to pay these amounts to Duggan until
December 31, 1998 and provided further, to the extent that
amendments to the Profit Sharing Retirement Plan, 401(k) Plan
or the Benefit Restoration Plan permit vesting and immediate
payment of such balances prior to December 31, 1998 for
Duggan, the Company shall not be obligated to m ...