EXHIBIT 10.4
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGE is made and entered into effective as of the 1" day
of January, 2000, by and between RED OAK FARMS, INC. (hereinafter referred to as
"Employer"), and XXXX XXXXXXXXX (hereinafter referred to as "Employee").
1. Employment. In consideration of the promises and mutual covenants and
agreements contained herein, Employer hereby employs Employee as its Chief
Operating Officer and Employee hereby accepts such employment upon the terms and
conditions hereinafter set forth.
2. Term.
a. Initial Term. The initial term of employment under this Agreement
(hereafter referred to as the "Initial Term") shall commence on the date hereof,
and shall expire six (6) months later, on June 31, 2000, unless terminated
earlier for cause as provided below.
b. Renewal. This Agreement will be renewed automatically for
additional terms of two (2) years in duration upon the expiration of any term.
It is provided, however, that if it is the desire of either party not to renew
the Agreement for a further two (2) year terra, the party wishing to terminate
the Agreement shall give written notice of non-renewal to the other party at
least one hundred twenty (120) days prior to the end of any term. Cause shall
not be required as a prerequisite to such notice.
c. Termination. Either party may terminate this Agreement at any time
with or without cause; provided, however, that in the case of such termination
(other than a termination by Employer for cause as set forth in subparagraph
(2.d below), the terminating party shall give one hundred twenty (120) days
advance written notice to the other party, utilizing hand delivery or restricted
certified mail. If certified mail is used, such notices will be deemed to have
been given on the date it is deposited in any United States Post Office mail
receptacle, properly addressed and bearing proper postage. In the case of
termination initiated by Employee, notice shall be given to the President of the
Employer. In the case of termination initiated by Employer, notice shall be
given to Employee.
Upon such notice of termination, Employee shall continue to render
services to Employer until the daze of termination unless: (i) Employer directs
Employee to cease rendering services at an earlier date; or (ii) Employer and
Employee agree that Employee will cease rendering services at an earlier date.
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Salary shall be paid following notice of termination only as follows:
(1) Employee shall be entitled to his regular pro-rated salary
following notice of termination for so long as Employee is
permitted to and actually continues to render services to
Employer during the 120-day period following such notice.
(2) If Employee is directed by Employer to cease work prior to
expiration of the 120-day period, Employee shall be entitled
to his regular pro-rated salary until the end of the 120-day
period, unless Employee has been terminated for cause pursuant
to subparagraph 2.d, in which case Employee shall not be
entitled to any further compensation.
d. Termination for Cause. Notwithstanding the provisions set forth in
subparagraphs 2.b and 2.c above, Employer may terminate this Agreement and
Employee's employment hereunder immediately during any term of this Agreement
upon the occurrence of any of the following by or relating to Employee: (i) a
material breach of the terms of this Agreement; (ii) embezzlement; (iii) fraud;
(iv) unethical conduct; (v) the conviction of a criminal act that in the sole
opinion of Employer may reflex negatively you the credibility or reputation of
Employee, to Employer's detriment; or (vi) other similarly outrageous personal
conduct.
3. Duties. Employee shall serve as Chief Operating Officer of Employer,
and shall devote his full-time attention and best efforts to the performance of
all duties regularly performed by an individual employed in that capacity.
Employee shall report to and be subject to the direction and authority of the
President, and shall perform such specific and additional duties as the
President shall direct.
4. Relocation. In the event Employee and Employer mutually desire to
extend Employee's employment beyond the six (6) month Initial Term, it is
understood and agreed that Employee will relocate to the Omaha, Nebraska/Red
Oak,-Iowa area after expiration of the six (6) month Initial Term, and that
renewal and extension of this Agreement, as well as Employee's eligibility for
bonuses, are contingent on such relocation.
5. Compensation
a. Raise Salary. For all services rendered by Employee during the six
(6) month Initial Term of this Agreement, Employee shall be paid a monthly
salary of eleven thousand two hundred fifty dollars ($11,250.00), payable in
accordance with Employer's usual payroll practices.
b. Cash Bonus. Employee shall be paid a bonus in the lump sum of
thirteen thousand five hundred dollars ($13,500.00) within thirty (30) days
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after relocating to the Omaha/Red Oak area, assuming Employee remains employed
by Employer at that time.
c. Stock/Stock Option Bonus. Within thirty (30) days after relocating
to ,tie Omaha/Red Oak area, assuming Employee remains employed by Employer at
that time, Employer shall cause its parent corporation, Red Oak. Hereford Farms,
Inc., to: (i) issue to Employee fifteen thousand (15,000) shares of Red Oak
Hereford Farms, Inc. common stock; and (ii) grant to Employee the option to
purchase twenty-five thousand (25, 000) shares of Red Oak Hereford Farms, Inc.
common stock for a purchase price of one dollar and fifty cents ($ 1.50) per
share, which option shall vest immediately and be exercisable until the date
which is one (1) year after the date of this Agreement and, if not exercised
within such one (1) year period, shall expire and shall thereafter be null and
void.
d. Additional Stock Options. Employer shall cause its parent
corporation, Red Oak Hereford Farms, Inc., to grant to Employee options to
purchase an additional one hundred thousand (100,000) shares of Red Oak Hereford
Farms, Inc. common stock at its fair market value as of the date of signing this
Agreement. Employee's options to purchase such additional shares shall vest at
the rate of thirty-three thousand shares per year for three (3) years, and after
vesting, shall be exercisable at each anniversary date of this Agreement,
unless, until, and to any such option expires pursuant to the following
sentence. Each vested option shall expire and thereafter be null and void if it
is not exercised within five (5) years of the applicable anniversary date upon
which such option vested. Employee shall be entitled to exercise such options
only if he remains employed by Employer at each vesting date.
6. Benefits.
a. Employee shall be entitled to participate in all fringe benefit
programs, including insurance coverage, vacation, and similar benefit programs,
that Employer makes available to its employees generally.
b. Employee shall have the use of a vehicle provided at the expense
of Employer for local use in Red Oak and in the conduct of Employer's business
during the six (6) month Initial Term.
7. Expense Reimbursement. During the six (6) month Initial Term of this
Agreement, Employee shall be entitled to reimbursement for reasonable air fare
expense (coach class at lowest available rate) incurred in commuting between Red
Oak, Iowa, and his home in Carmel, Indiana. Such reimbursement shall be limited
to twenty-four (24) round-trip tickets during said six-month period.
Employee shall be entitled to a reasonable housing allowance during the
six (6) month Initial Term, in an amount to be agreed upon by the parties, for
the purpose of securing a modest apartment in or around Red Oak, Iowa.
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8. Confidentiality. Employee acknowledges and agrees that during the
course of his employment he may have access to certain proprietary confidential,
information of Employer, maintained in confidence by Employer as trade secrets,
including but not limited to information pertaining to Employer's customers,
processes, products, pricing, purchasing, accounting, marketing, finances and
business practices. Employee further acknowledges and agrees that all
information disclosed to or accessed by Employee, including information
originated by Employee in the course of performing his duties for Employer,
which Employee has reason to believe is confidential or which is treated by
Employer as confidential, shall be presumed to be confidential information,
unless such information was available to the public by publication or otherwise
was part of the public domain through no fault of Employee. Employee further
acknowledges and agrees that Employer has developed and established and its
continuing to develop and establish a valuable and extensive trade in its
products and services, and that Employer would suffer great loss and irreparable
injury if Employee discloses any confidential information or uses it to
Employer's detriment.
Employee, during the course of his employment and at all times
thereafter, shall maintain in strictest confidence and shall not directly or
indirectly divulge, release, disclose, or make available to any other firm,
person, corporation, or other entity any confidential information of Employer,
except as required by his employment or as permitted by Employer in writing.
Upon termination of his employment, Employee shall deliver promptly to
Employer all records, manuals, documents, books, reports, notes, data, computer
disks, and similar matter that are the property of Employer, and shall keep no
photocopies, facsimiles, or other duplications thereof.
9. Noncompetition.
a. Employee agrees that during any term of this Agreement and for a
period of two (2) years from and after the date of expiration or termination of
this Agreement by either party, Employee will not, without Employer's prior
written consent, perform services for or have any interest in any entity that
offers products or services competitive with the products or services then
offered or performed by Employer within the Restricted Area. For purposes of
this paragraph, products or services shall be deemed to be competitive if they
relate to the sale of beef products (fresh and pre-cooked), smoked salmon,
and/or imported European food and food products, excluding candy products. The
"Restricted Area." shall mean the continental United States.
b. Employee further agrees that during any terra of this Agreement
and for a period of two (2) years from and after the date of expiration or
termination of this Agreement by either party, Employee will not, directly or
indirectly, in any capacity whatsoever, contact; call on, sell to, solicit
business from, or render any service to any of Employer's current, former or
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prospective customers, clients, contacts within the industry, for any
competitive product or service developed, produced, marketed, distributed, or
sold by Employer during the period of Employee's employment. For purposes of
this paragraph, products or services shall be deemed to be competitive if they
relate to the sale of beef products (fresh and pre-cooked), smoked salmon,
and/or imported European food and food products, excluding candy products.
10. Equitable Enforcement. Employee acknowledges and agrees that the
terms and conditions set forth in paragraphs 8 and 9 are reasonable and
necessary for the protection of Employer's business and are necessary to prevent
damage or loss to Employer, and that any breach by Employee of the foregoing
provisions may cause Employer irreparable injury for which there may be no
adequate remedy at law. Employee further agrees that the services to be rendered
by him are of a special and unique character, which gives them a special value
in the successful operation of Employer's business. By reason thereof, Employee
agrees that Employer shall be entitled to injunctive and equitable relief to
prevent or curtail any breach of the provisions of paragraphs 8 and 9 by him, in
addition to any other remedies Employer may have under this Agreement. In the
event it is necessary for Employer to take legal action to enforce the terms of
paragraphs 8 and 9, and Employer prevails, Employee shall be responsible for the
attorneys fees incurred by Employer in its successful enforcement. It is further
agreed that the provisions of paragraphs 8 and 9, as well as this paragraph 10,
shall survive the termination of this Agreement.
11. Successors and Assigns Bound. This Agreement shall be binding upon
Employer and Employee, their respective heirs, executors, administrators,
successors in interest or assigns, including without limitation, any
partnership, corporation, or other entity into which Employer may be merged or
by which it may be acquired (whether directly, indirectly, or by operation of
law), or to which is may assign its rights under this Agreement Notwithstanding
the foregoing, any assignment by Employee of this Agreement or of any interest
herein shall be void.
12. Leverability. In the event that any one or more of the provisions
of this Agreement or any word, phrase, clause, sentence, or other portion
thereof (including without limitation the geographical and temporal restrictions
contained herein) shall be deemed by a court of competent jurisdiction to be
illegal, invalid, or unenforceable for any reason, it is hereby agreed that said
invalidity or unenforceability shall not affect the other portions of this
Agreement and that such provision or portion thereof shall be considered
modified or deleted in such manner as to make this Agreement, as modified,
legal, and enforceable to the fullest extent permitted under applicable laws.
The validity and enforceability of the remaining provisions or portions thereof
shall continue unimpaired.
13. Waiver. The waiver by Employer of its rights under this Agreement
or the failure of Employer promptly to enforce any provision hereof shall not be
construed as a waiver of any subsequent breach of the same or any other
covenant, term, or provision.
14. Entire Agreement. This Agreement constitutes the entire Agreement
between the parties hereto with regard to the subject matter hereof, and there
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are no agreements, under standings, specific restrictions, warranties, or
representations relating to said subject matter between the parties other than
those set forth herein or herein provided for. No amendment or modification of
this Agreement shall be valid or binding unless in writing and signed by the
party against whom such amendment or modification is to be enforced.
15. Notices. Any notice required to be given hereunder shall be in
writing and shall be deemed to be sufficiently served by either parry on the
other party if such notice is delivered personally or is sent by certified or
first class mail addressed as follows:
To Employee:
Xxxx Xxxxxxxxx
0000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
To Employer:
Red Oak Farms, Inc.
XX Xxx 000
Xxx Xxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx, President
16. Governing Law. This Agreement is entered into pursuant to and
shall be governed by and in accordance with the laws of the State of Iowa.
IN WITNESS WHEREOF, the parties have duly executed this EMPLOYMENT
AGREEMENT effective as of the date first above written,
EMPLOYEE: EMPLOYER:
Red Oak Farms, Inc.
By: Xxxx Xxxxxxxxx By: (signature illegible)
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Xxxx Xxxxxxxxx Its: (signature illegible)
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