EXHIBIT 10.20
EMPLOYMENT AGREEMENT
AGREEMENT dated this 11th day of December, 1995,
between RKR-GP, Inc., a Delaware corporation (the "General
Partner"), as general partner of KPR Holdings, L.P., a Delaware
limited partnership (the "Company") and Xxxxxx X. Xxxx (the
"Executive").
WHEREAS, Foodbrands America, Inc. ("Foodbrands") is
acquiring the entire limited partnership interest in the Company
and all stock of the General Partner for the purpose of
maintaining and operating the businesses owned thereby;
WHEREAS, the Executive, directly and indirectly, is a
beneficial owner of General Partner and the Company and has
specific duties and unique talents with regard to these business
operations and Foodbrands and the Company desire to ensure the
continued success of these operations; and
WHEREAS, in connection with the acquisition of the
Company and General Partner by Foodbrands, Foodbrands and
Executive have required that this Employment Agreement be entered
into;
NOW, THEREFORE, it is agreed as follows:
1. Services to be Provided. Executive will serve as
President of Kettle Cooked Foods and Vice President of the
General Partner and the Company and Vice President of Foodbrands.
Consistent with Executive's office, Executive shall render
services to the General Partner and the Company as the Board of
Directors of General Partner may time to time designate.
Executive will see that all orders and resolutions of the Board
of Directors of General Partner are carried into effect. In
addition, will be responsible for the day-to-day operations of
Kettle Cooked Foods a division of the Company, the development
and execution of the appropriate marketing plans and budgets for
the Company, the interaction between Kettle Cooked Foods, the
Company and the headquarters of Foodbrands and Foodbrands' other
divisions and subsidiaries.
Executive shall devote such time and efforts to the
performance of his duties hereunder and to advancing the interest
of the Company and Foodbrands, subject only to reasonable working
hours, conditions and requirements as are consistent with past
practices of Executive for the Company. In the performance of
his duties, the Executive shall comply with the Company's
policies. Executive will not engage in consulting work or any
trade or business for his own account or for or on behalf of any
other person, firm or corporation which competes, conflicts or
interferes with the performance of his duties hereunder in any
way (except as specifically provided in Section 7 below);
provided that the Company acknowledges that the Executive may
perform consulting services for Winchester Food Processing, Inc.
("Winchester") and Standard Meat Company L.P. ("Standard") as
long as performance of such services do not materially interfere
with the performance of Executive's duties under this Agreement.
The foregoing shall not preclude the Executive from devoting
reasonable time to the supervision of his personal investments,
civic and charitable affairs and serving on other boards,
provided that such activities do not interfere with the
performance of his duties hereunder; and further provided that
the Executive shall not serve on the board of any other business
(except as provided in Section 7, below) without the advance
consent of the General Partner, which consent shall not be
unreasonably withheld.
2. Term. The Term of this Agreement shall refer to
the time during which it is in effect. It shall commence on
December 11, 1995, and end on December 10, 2000, or an earlier
date as provided herein.
3. Compensation. During the Term, the Company shall
provide Executive with the following minimum compensation and
benefits:
(a) Salary. Executive shall be paid at the rate
of $175,000 per annum (such payment shall be referred to in this
Agreement as the "Base Compensation"), payable in accordance with
the normal payroll policies of Foodbrands, as they may exist from
time to time. The Base Compensation will be subject to annual
merit increases in accordance with Foodbrands' normal policies.
These payments shall be subject to withholding for all applicable
taxes.
(b) Bonus. Commencing with fiscal year 1996,
Executive shall be entitled to participate in the Foodbrands' Key
Management Cash Incentive Plan, as it may exist from time to
time. The target incentive percentage for Executive will be set
by the Foodbrands' Compensation Committee consistent with those
established for executives of other divisions of Foodbrands
performing comparable duties. The annual bonus will be paid when
the other bonuses of senior executives of the Company are or will
be paid, according to the policy of the Company.
(c) Expenses. The Company shall promptly
reimburse Executive for all reasonable expenses incurred in
connection with employment pursuant to the terms of this
Agreement during the Term. In order to receive reimbursement,
Executive must properly account for expenses in accordance with
the policy of the Company.
(d) Other Benefits. In addition to the
aforementioned items, the Company shall provide or make available
to Executive such pension and welfare benefit plans and programs
of the Company as currently exist or those pension and welfare
benefit plans and programs of Foodbrands as are provided to other
executives of the Company in other divisions of Foodbrands in the
event the Company ceases providing any such benefits, and to
receive benefits thereunder, in accordance with their respective
terms. Except as otherwise set forth in this Agreement, it is
understood that Executive will not be entitled to participate in
any other stock option, bonus or severance plan of Foodbrands.
In addition, the Company shall provide the Executive during the
Term with a car in accordance with the past practice of the
Company.
(e) Stock Options. As soon as practicable, but
in no event later than 90 days after the date of this Agreement,
the Company and Executive shall execute a Stock Option Agreement
with respect to stock options to be granted to the Executive (the
"Option Agreement") pursuant to the Foodbrands America, Inc. 1992
Stock Incentive Plan (the "Stock Plan"). Pursuant to the Option
Agreement:
(i) Foodbrands will immediately grant options to
purchase 12,000 shares of the common stock of Foodbrands at a per
share price equal to $13.125. Nine percent (9%) of the options
shall be exercisable or vested as of the date of this Agreement
and 18.2% of the options shall vest as of the end of each fiscal
year commencing with December 28, 1996 until all options have
vested subject to achieving the EBITDA performance targets of
Foodbrands as established by the Compensation Committee of
Foodbrands and the terms and conditions set forth in the Stock
Plan and the Option Agreement.
4. Termination During the Term. Executive's
employment hereunder may terminate for any of the following
reasons:
(a) Death. This Agreement shall terminate upon
Executive's death.
(b) Disability. If, as a result of Executive's
incapacity due to physical or mental illness ("Disability"),
Executive shall have been absent from the full-time performance
of his duties with the Company for any six months within any
consecutive 12-month period, Executive's employment may be
terminated.
(c) Cause. Termination by the Company of
Executive's employment for "Cause" shall mean termination based
upon (i) Executive's indictment for, or conviction of, any felony
or any crime involving moral turpitude, (ii) commission any
theft, fraud or embezzlement by Executive which results in
Executive's gain or personal enrichment at the expense of the
Company, (iii) Executive's failure to follow instructions of the
Chief Executive Officer of the Company, or his successor or
designee, or such other executive of the Company of comparable
rank as the Board of Directors of the Company may direct, or the
Board of Directors of the Company, (iv) inability to perform
duties and responsibilities as a result of an addiction to
alcohol or drugs, other than drugs legally prescribed and
administered by a duly licensed physician, or (v) breach of any
obligations under this Agreement, including, but not limited, to
breaches of Sections 7, 8 or 9 of this Agreement. Executive may
not be terminated for Cause unless the Company has first
specified the act, omission or breach forming the basis for such
termination in the Notice of Termination (as hereinafter
defined), and Executive has failed or refused to correct such
act, omission or breach within ten days of receipt of the Notice
of Termination or such act, omission or breach is incapable of
being cured.
(d) Voluntary Termination. Executive may
voluntarily terminate employment at any time during the Term (a
"Voluntary Termination").
(e) Termination by the Company. The Company may
terminate Executive's employment for any reason during the Term
hereof, including, but not limited to, closing or selling the
Company provided, however, that upon such termination, Executive
will be compensated as provided in Section 5.
(f) Notice of Termination. Any termination of
Executive's employment shall be communicated by written Notice of
Termination to the other party hereto in accordance with this
Section 4(f). For purposes of this Agreement, a "Notice of
Termination" shall mean a written notice which shall indicate the
specific termination provision in this Agreement relied upon and
which shall specify a date as Executive's last day of employment
(the "Termination Date").
5. Compensation Upon Termination or During
Disability. Upon termination of employment or during a period of
disability, Executive shall be entitled to the following
benefits:
(a) If Executive's employment is terminated
during the Term by reason of death, the Company shall pay to
Executive's estate Executive's Base Compensation as though
employment was were terminated by the Company without Cause (the
"Continued Compensation Period"), and the bonus for the bonus
period in which the Termination Date occurs. Thereafter, the
Company and its affiliates shall have no further obligations to
Executive, other than as provided in this Agreement.
(b) During any period that Executive fails to
perform his full-time duties with the Company as a result of
Disability, Executive shall continue to receive Base Compensation
during such period, and the bonus for the bonus period in which
the Disability occurs. During such period that Executive fails
to perform his full-time duties with the Company as a result of
Disability, Executive shall continue to receive all compensation
payable to Executive and Company's Disability benefit programs
then in effect during such period, unless and until this
Agreement shall be terminated pursuant to Section 4(b) of this
Agreement.
(c) If Executive's employment is terminated
during the Term by reason of Disability, Executive shall continue
to receive his Base Compensation through the Continued
Compensation Period and the bonus for the bonus period in which
the Termination Date occurs. Executive shall also continue to
receive all compensation payable under the Company's Disability
benefit programs then in effect through the expiration of the
Term; thereafter, benefits shall be determined under the
retirement, insurance and other compensation programs (other than
the bonus arrangements described in Section 3(b) of this
Agreement of the Company then in effect in accordance with the
terms of such programs).
(d) If Executive's employment is terminated by
the Company for Cause or as a result of a Voluntary Termination,
the Company shall pay Executive his Base Compensation through the
Termination Date in the Notice of Termination, and the Company
and its affiliates shall have no further obligations under this
Agreement.
(e) If Executive's employment is terminated
during the Term by the Company other than for death, Cause or
Disability, or other than as a result of a Voluntary Termination,
then the Company shall pay Executive his Base Compensation equal
to a one-year period.
(f) The Executive and Foodbrands may enter into
an agreement providing for certain rights of the parties in the
event of a change of control in the ownership of Foodbrands, in
which event Executive's rights and obligations on the occurrence
of such an event will be governed thereby.
(g) In addition to all other amounts payable to
Executive under this Section 5, Executive shall be entitled to
receive all benefits payable to Executive under the plans or
agreements of the Company relating to retirement benefits
pursuant to the terms of such plan.
6. Successors; Binding Agreement. This Agreement and
all of the provisions hereof shall be binding upon and inure to
the benefits of the parties hereto and their respective
successors and permitted assigns, but neither this Agreement nor
any of the rights, interests or obligations hereunder shall be
assigned by any of the parties hereto without the prior written
consent of the other parties, nor is this Agreement intended to
confer upon any other except the parties hereto, any rights or
remedies hereunder. Notwithstanding the foregoing, the Company
may assign its rights under this Agreement, but no such
assignment shall relieve the Company of its obligations
hereunder.
7. Noncompetition. Notwithstanding anything to the
contrary contained in this Agreement, Executive may not, directly
or indirectly, (1) conduct any activities involving the
developing, manufacturing, or marketing or selling of soups,
sauces, side dishes or pizza toppings or other products that are
competitive in any way with the Company (the "Prohibited
Business"); (2) engage (as an individual or as a stockholder,
trustee, partner, financier, agent, employee or representative of
any person, firm, corporation, or association), or have any
interest, direct or indirect, in any Prohibited Business and (3)
may not assist or engage in any business related activities
involving those products currently produced or under development
by the Company, all for a period of five (5) years after
termination of employment. The parties hereto agree that the
duration and geographic area for which the covenant not to
compete set forth in this Section 7 is to be effective are
reasonable. However, in the event that any court determines that
the time period or the geographic area, or both of them, are
unreasonable, and that such covenant is, to that extent,
unenforceable, the parties hereto agree that the covenant shall
remain in full force and effect for the greatest time period and
for the greatest area that would not render it unenforceable.
The parties hereto agree that the covenant shall be deemed to be
a series of separate covenants, one for each and every state or
county of the geographic area where the covenant not to compete
is intended to be effective. Notwithstanding anything to the
contrary in this Section 7, ownership of less than 5% of the
voting stock of any publicly held corporation shall not
constitute a violation of this Section 7. In addition, this
Section 7 shall not apply in connection with the passive
ownership of any interest in Winchester and Standard (including,
without limitation, serving as a member of their respective
Boards of Directors) nor to any management activity of Executive
for Winchester or Standard, so long as Winchester and Standard do
not compete with any products produced by the Company other than
meat ball, pasta meat, and other products of Winchester being
produced or under development as of the date of this Agreement,
which are described in Exhibit A hereto.
8. Nonsolicitation. For a period of five (5) years
from the termination of this Agreement, whether by expiration of
the Term or pursuant to Section 4, Executive agrees not to
solicit, or to attempt to induce to cease doing business in whole
or in part with the Company or Foodbrands, any individuals or
business entities that were customers of the Company or
Foodbrands, during his employment and any prospective customers
with respect to whom the Company has initiated contacts during
the 12 months preceding the termination of employment. Executive
further agrees that for this same period he shall not, directly
or indirectly, solicit any employees of the Company or Foodbrands
to leave the employ of the Company or Foodbrands.
9. Confidential Information. During the Term and at
all times thereafter, Executive shall not, without the prior
written consent of Foodbrands (except as may be required in
connection with any judicial or administrative proceeding or
inquiry), disclose to any person, other than an officer or
director of the Company or a person to whom disclosure is
reasonably necessary or appropriate in connection with the
performance of duties hereunder, any confidential information of
the Company, whether obtained while in the employ of the Company
or otherwise, with respect to the business of the Company or
Foodbrands, assets or operations, including confidential
information relating to the properties, accounts, books, records,
supplies, trade secrets and contracts of the Company or
Foodbrands.
10. Injunctive Relief. The remedy at law for any
breach of Sections 7, 8 and 9 of this Agreement is and will be
inadequate, and in the event of a breach or threatened breach by
Executive of the provisions of this Agreement, the Company shall
be entitled to an injunction restraining Executive from
soliciting employees or customers of the Company or from
disclosing, in whole or in part, the private, secret and
confidential information described herein, or from rendering any
services to any person, firm, corporation, association or other
entity to whom such information has been disclosed or is
threatened to be disclosed, from engaging, participating in or
otherwise being connected with any business which would violate
Section 7, or from otherwise violating the provisions of this
Agreement. Nothing herein shall be construed as prohibiting the
Company from pursuing any other remedies available for such
breach or threatened breach, including the recovery of damages
from Executive.
11. Separate Covenants. This Agreement shall be
deemed to consist of a series of separate covenants. Executive
expressly agree that the character, duration and geographical
scope of this Agreement are reasonable in light of the
circumstances as they exist on the date upon which this Agreement
has been executed. If, in any judicial proceeding, a court shall
refuse to enforce all of the separate covenants included herein
because they are more extensive than necessary to assure
Foodbrands and the Company of the intended benefit of this
Agreement, then those covenants which, if eliminated, would
permit the remaining separate covenants to be enforced in such
proceeding shall, for the purpose of such proceeding, be deemed
eliminated from this Agreement.
12. Return of Documents. Upon termination of
Executive's employment for any reason, Executive agrees to return
all documents and other property provided to Executive or
prepared during his employment with the Company.
13. Notice. For the purpose of this Agreement,
notices and all other communications provided for in the
Agreement shall be in writing and shall be deemed to have been
duly given when delivered or mailed by United States certified
mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth below, provided that all notices
to the Company shall be directed to the Secretary of Foodbrands,
or to such other address as either party may have furnished to
the other in writing in accordance herewith, except the notice of
change of address shall be effective only upon receipt.
Foodbrands America, Inc.
0000 Xxxxxxxxx Xxxxxxxxxx
Xxxxx 0000
Xxxxxxxx Xxxx, XX 00000
Xxxxxx X. Xxxx
0000 Xxxxxxxx Xx.
Xx. Xxxxx, XX 00000
14. Disputes. Any controversy or claim arising out of
or relating to this Agreement, or any breach hereof, shall be
settled by submitting that matter to binding arbitration in
Oklahoma City, Oklahoma, or at such other location the parties
agree by and pursuant to the rules of the American Arbitration
Association then in effect. The determination of the arbitrator
shall be conclusive and binding on the Company and the Executive,
and judgment may be entered on the arbitrator's award in any
court of competent jurisdiction.
15. Miscellaneous. No provision of this Agreement may
be modified, waived or discharged unless such waiver,
modification or discharge shall be agreed to in writing and
signed by Executive and by a duly authorized officer of the
Company. No waiver by either party hereto at any time of any
breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such
other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter
hereof have been made by either party which are not expressly set
forth in this Agreement. All descriptive headings in this
Agreement are inserted for convenience only and shall be
disregarded in construing or applying any provision of this
Agreement. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of
the State of Oklahoma. Any payments provided for hereunder shall
be paid net of any applicable withholding requirements under
federal, state or local law. The obligations under Sections 5,
7, 8 and 9 shall survive the expiration of this Agreement or the
termination of employment.
16. Validity. The invalidity or unenforceability of
any provision of this Agreement shall not effect the validity or
enforceability of any other provision of this Agreement, which
shall remain in full force and effect.
17. Counterparts. This Agreement may be executed in
several counterparts, each of which shall be deemed to be an
original, but all of which together will constitute one and the
same instrument.
EXECUTED the date first above written.
(Xxxxxx X. Xxxx)
Xxxxxx X. Xxxx
"Executive"
KPR HOLDINGS, L.P.
By: RKR-GP, Inc., general partner
By (Xxxxxxx X. Xxxxxxxxx)
Xxxxxxx X. Xxxxxxxxx,
President
"COMPANY"
Winchester Food Processing, Inc. Products
EXHIBIT A
Pizza Hut Bacon Pieces
Pizza Hut Bacon Bits
Pizza Hut Meatballs
Pizza Hut Pasta Meat
KFC Diced Ham
Bacon Toppings*
Bacon Bits*
* Provided, Winchester will not sell these products directly to
existing Foodbrands customers
