EMPLOYMENT AGREEMENT
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THIS AGREEMENT is made this 28th day of June, 2001, by and between PINNACLE
FOODS, INC., a Pennsylvania corporation (hereinafter called "Company"), and
XXXXXX XXXXX, an individual (hereinafter called "Employee").
W I T N E S S E T H:
Company wishes to employ Employee and Employee wishes to enter into the
employ of Company on the terms and conditions contained in this Agreement.
NOW, THEREFORE, in consideration of the facts, mutual promises and
covenants contained herein and intending to be legally bound hereby, Company and
Employee agree as follows:
1. Employment. Company hereby employs Employee and Employee hereby accepts
employment by Company for the period and upon the terms and conditions contained
in this Agreement.
2. Office and Duties.
(a) Employee shall serve Company generally as Senior Executive Vice
President and Chief Operating Officer and shall have such authority and such
responsibilities as Company reasonably may determine from time to time. Employee
shall perform any other duties reasonably required by Company and, if requested
by Company, shall serve as a director of Company without additional
compensation.
(b) Throughout the term of this Agreement, Employee shall devote his
entire working time, energy, skill and best efforts to the performance of his
duties hereunder in a manner which will faithfully and diligently further the
business and interests of Company.
3. Term. This Agreement shall be for a term of five (5) years, commencing
on July 16, 2001, and ending on July 15, 2006, unless sooner terminated as
hereinafter provided. The twelve month period commencing on July 16, 2001 and
ending on July 15, 2002 is referred to as the First Employment Year, the next
twelve month period is referred to as the Second Employment Year, and so on from
year to year. Unless either party elects to terminate this Agreement at the end
of the original or any renewal term by giving the other party notice of such
election at least sixty (60) days before the expiration of the then current
term, this Agreement shall be deemed to have been renewed for an additional term
of one (1) year commencing on the day after the expiration of the then current
term.
4. Compensation.
(a) For all of the services rendered and to be rendered by Employee to
Company during the First Employment Year, Employee shall receive an annual base
salary of One Hundred Fifty Thousand Dollars ($150,000), payable in reasonable
periodic installments in accordance with Company's regular payroll practices in
effect from time to time. For each Employment Year thereafter, Employee's salary
shall be the product of the CPI Factor (as defined below) for such Employment
Year multiplied by One Hundred Fifty Thousand Dollars ($150,000). The "CPI
Factor" with respect to an Employment Year means a fraction, the numerator of
which is the Consumer Price Index for all Urban Consumers - U.S. City Average
All Items ("CPI-U") as published by the Bureau of Labor Statistics of the U.S.
Department of Labor (1982-84=100) for the month of August in such Employment
Year, and the denominator of which is the CPI-U for the month of August, 2001.
In the event of a change in the base index year, change in groups or components,
or other change in the index measurement procedure, or if the Department of
Labor discontinues publication of the Consumer Price Index, then Company and
Executive shall in good faith make an appropriate adjustment or shall select an
equivalent consumer price index from a source recognized generally as a reliable
source for such statistical information.
(b) In addition to Employee's base salary, Company from time to time
may pay Employee such bonuses or other additional compensation as Company may
determine, but there is no agreement regarding any such additional payments, the
existence and amounts of which shall be within Company's sole discretion.
5. Automobile and Expenses.
(a) Throughout the term of this Agreement, Company will furnish
Employee with a late model Toyota Camry or a similar automobile and will
reimburse Employee for the reasonable expenses incurred in connection with its
operation.
(b) Company will reimburse Employee for all reasonable expenses
incurred by Employee in connection with the performance of Employee's duties
hereunder upon receipt of vouchers therefor and in accordance with Company's
regular reimbursement procedures and practices in effect from time to time.
6. Benefits.
(a) The Company shall reimburse Employee for the cost of purchasing
health insurance through COBRA offered by his former employer during any waiting
period or period of ineligibility in which he is not covered by the Company's
health insurance plan.
(b) The Company shall, during the term of this Agreement, pay the
annual premiums for a term life insurance policy which insures the life of
Employee in the face amount of One Million Dollars ($1,000,000) and on which
Employee may name the beneficiary. Employee shall cooperate with Company and
each prospective insurer in obtaining such policy and any other life insurance
policy which insures the life of Employee which Company may choose to purchase
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for Company's own benefit from time to time, including without limitation, the
scheduling of and attendance at a medical examination, if requested to do so.
(c) The Company shall issue to Employee options to purchase Two
Hundred Fifty Thousand (250,000) shares of Company common stock at an exercise
price per share of One Dollar ($1.00). Such options shall be evidenced by a
separate stock option agreement to be dated July 16, 2001 and otherwise in
compliance with the Company's 2001 Stock Option Plan (the "Stock Option
Agreement"). Such options shall vest in equal installments at the end of each of
the first four Employment Years if Employee is still employed by Company
hereunder at each such date.
(d) Throughout the term of this Agreement and as long as they are kept
in force by Company, Employee shall be entitled to participate in and receive
the benefits of any profit sharing or retirement plans and any health, life,
accident or disability insurance plans or programs made available to other
similarly situated employees of Company.
(e) Employee shall be entitled to four (4) weeks paid vacation during
each Employment Year during the term of this Agreement. Company shall not pay in
cash for any unused vacation time.
7. Disability.
(a) If Employee becomes unable to perform his duties hereunder due to
partial or total disability or incapacity resulting from a mental or physical
illness, injury or any other cause, Company will continue the payment of
Employee's base salary at its then current rate for a period of thirteen (13)
weeks following the date Employee is first unable to perform his duties due to
such disability or incapacity. Thereafter, Company shall have no obligation for
base salary or other compensation payments to Employee during the continuance of
such disability or incapacity.
(b) If Employee is unable to perform his duties hereunder due to
partial or total disability or incapacity resulting from a mental or physical
illness, injury or any other cause for a period of twenty-six (26) consecutive
weeks or for a cumulative period of twenty-six (26) weeks during any
twelve-month period, Company shall have the right to terminate this Agreement
thereafter, in which event Company shall have no further obligations or
liabilities hereunder after the date of such termination.
(c) Nothing contained in this Paragraph 7 shall be or be deemed to be
a waiver by Employee of any rights or remedies under the Americans with
Disabilities Act.
8. Death. If Employee dies, all payments hereunder shall cease at the end
of the month in which Employee's death shall occur and Company shall have no
further obligations or liabilities hereunder to Employee's estate or legal
representative or otherwise, except for obligations to issue shares upon proper
the exercise of vested stock options (if any) held by Employee at the time of
his death in accordance with the terms of the Stock Option Agreement.
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9. Termination of Company's Business. If Company shall discontinue the
business operation in which Employee is employed in its entirety, Company may
terminate Employee's employment on four (4) weeks' prior notice, and in such
event Company shall have no further obligations or liabilities hereunder and
Employee shall be released from the restrictions contained in subparagraphs
12(a) and 12(b) hereof.
10. Discharge for Cause. Company may discharge Employee at any time for
criminal conduct (other than minor traffic violations), whether or not related
to Employee's employment, or for incompetence, being under the influence of
alcohol or a controlled substance, drug addiction, using alcohol or a controlled
substance while at work, gross negligence, any violation of any express
direction or any reasonable rule or regulation established by Company from time
to time regarding the conduct of its business, or any violation by Employee of
the terms and conditions of this Agreement, in which event Company shall have no
further obligations or liabilities hereunder after the date of such discharge.
For purposes of determining whether Employee is under the influence of alcohol
or a controlled substance, the Company may conduct, and Employee hereby agrees
to, random drug and alcohol tests and screenings.
11. Company Property. All advertising, sales, and other materials or
articles or information, including without limitation data processing reports,
customer sales analyses, invoices, price lists or information, modified
atmosphere gas mixtures, samples, budgets, business plans, strategic plans,
financing applications, reports, memoranda, correspondence, financial
statements, and any other materials or data of any kind furnished to Employee by
Company or developed by Employee on behalf of Company or at Company's direction
or for Company's use or otherwise in connection with Employee's employment
hereunder, are and shall remain the sole and confidential property of Company;
if Company requests the return of any such materials at any time during or at or
after the termination of Employee's employment, Employee shall immediately
deliver the same to Company.
12. Noncompetition, Trade Secrets, Etc.
(a) During the term of this Agreement and for a period of one (1) year
after the termination of his employment with Company for any reason whatsoever,
Employee shall not directly or indirectly induce or attempt to influence any
employee of Company to terminate his or her employment with Company and shall
not engage in (as a principal, partner, director, officer, agent, employee,
consultant or otherwise) or be financially interested in any business operating
east of the Mississippi River in the United States of America, the primary
business of which is case-ready meat processing, packaging, or distribution, or
any other business being definitely planned by Company at the time of the end of
Employee's employment. However, nothing contained in this Paragraph 12 shall
prevent Employee from (i) working for a food wholesaler or food retailer or (ii)
holding for investment no more than five percent (5%) of any class of equity
securities of a company whose securities are traded on a national securities
exchange or on the NASDAQ System.
(b) During the term of this Agreement and at all times thereafter,
Employee shall not use for his personal benefit, or disclose, communicate or
divulge to, or use for the direct or indirect benefit of any person, firm,
association or company other than the Company, any material referred to in
Paragraph 11 above or any information regarding the business methods, business
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policies, procedures, techniques, research or development projects or results,
trade secrets, or other knowledge or processes of or developed by the Company or
any names and addresses of customers or clients, any data on or relating to
past, present or prospective customers or clients, or any other confidential
information relating to or dealing with the business operations or activities of
Company, made known to Employee or learned or acquired by Employee while in the
employ of Company.
(c) Any and all reports, plans, budgets, writings, inventions,
improvements, processes, procedures and/or techniques which Employee may make,
conceive, discover or develop, either solely or jointly with any other person or
persons, at any time during the term of this Agreement, whether during working
hours or at any other time and whether at the request or upon the suggestion of
the Company or otherwise, which relate to or are useful in connection with any
business now or hereafter carried on or contemplated by the Company, including
developments or expansions of its present fields of operations, shall be the
sole and exclusive property of Company. Employee shall make full disclosure to
Company of all such reports, plans, budgets, writings, inventions, improvements,
processes, procedures and techniques, and shall do everything necessary or
desirable to vest the absolute title thereto in Company. Employee shall write
and prepare all specifications and procedures regarding such inventions,
improvements, processes, procedures and techniques and otherwise aid and assist
Company so that Company can prepare and present applications for copyright or
Letters Patent therefor and can secure such copyright or Letters Patent wherever
possible, as well as reissues, renewals, and extensions thereof, and can obtain
the record title to such copyright or patents so that Company shall be the sole
and absolute owner thereof in all countries in which it may desire to have
copyright or patent protection. Employee shall not be entitled to any additional
or special compensation or reimbursement regarding any and all such writings,
inventions, improvements, processes, procedures and techniques.
(d) Employee acknowledges that the restrictions contained in the
foregoing subparagraphs (a), (b) and (c), in view of the nature of the business
in which Company is engaged, are reasonable and necessary in order to protect
the legitimate interests of Company, and that any violation thereof would result
in irreparable injuries to Company, and Employee therefore acknowledges that, in
the event of his violation of any of these restrictions, Company shall be
entitled to obtain from any court of competent jurisdiction preliminary and
permanent injunctive relief as well as damages and an equitable accounting of
all earnings, profits and other benefits arising from such violation, which
rights shall be cumulative and in addition to any other rights or remedies to
which Company may be entitled.
(e) If the period of time or the area specified in subparagraph (a)
above should be adjudged unreasonable in any proceeding, then the period of time
shall be reduced by such number of months or the area shall be reduced by the
elimination of such portion thereof or both so that such restrictions may be
enforced in such area and for such time as is adjudged to be reasonable. If
Employee violates any of the restrictions contained in such subparagraph (a),
the restrictive period shall not run in favor of Employee from the time of the
commencement of any such violation until such time as such violation shall be
cured by Employee to the satisfaction of Company.
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13. Prior Agreements. Employee represents to Company (a) that there are no
restrictions, agreements or understandings whatsoever to which Employee is a
party which would prevent or make unlawful his execution of this Agreement or
his employment hereunder, (b) that his execution of this Agreement and his
employment hereunder shall not constitute a breach of any contract, agreement or
understanding, oral or written, to which he is a party or by which he is bound
and (c) that he is free and able to execute this Agreement and to enter into
employment by Company.
14. Miscellaneous.
(a) Indulgences, Etc. Neither the failure nor any delay on the part of
either party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or of any other right, remedy, power or privilege, nor
shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.
(b) Controlling Law. This Agreement and all questions relating to its
validity, interpretation, performance and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be governed by
and construed in accordance with the laws of the Commonwealth of Pennsylvania,
notwithstanding any conflict-of-laws doctrines of any jurisdiction to the
contrary, and without the aid of any canon, custom or rule of law requiring
construction against the draftsman.
(c) Notices. All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing and shall be
deemed to have been duly given, made and received only when delivered
(personally, by courier service such FedEx or by other messenger) against
receipt or upon actual receipt of registered or certified mail, postage prepaid,
return receipt requested, addressed as set forth below:
(i) If to Company:
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: President
with a copy, given in the manner prescribed above, to:
Xxxxxx X. Xxxx, Esquire
Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, LLP
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, X 00000-0000
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(ii) If to Employee:
00 Xxxxxxxx Xxxx
Xxxx Xxxxxxx, XX 00000
In addition, notice by mail shall be sent by a recognized international courier
(such as Fed Ex) if posted outside of the continental United States. Either
party may alter the address to which communications or copies are to be sent by
giving notice of such change of address in conformity with the provisions of
this subparagraph for the giving of notice.
(d) Binding Nature of Agreement; No Assignment. This Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns, except that
no party may assign or transfer its rights nor delegate its obligations under
this Agreement without the prior written consent of the other parties hereto.
(e) Execution in Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original as against either
party whose signature appears thereon, and both of which shall together
constitute one and the same instrument. This Agreement shall become binding when
one or more counterparts hereof, individually or taken together, shall bear the
signatures of both of the parties reflected hereon as the signatories.
(f) Provisions Separable. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.
(g) Entire Agreement. This Agreement contains the entire understanding
between the parties hereto with respect to the subject matter hereof, and
supersedes all prior and contemporaneous agreements and understandings,
inducements or conditions, express or implied, oral or written, except as herein
contained. The express terms hereof control and supersede any course of
performance and/or usage of the trade inconsistent with any of the terms hereof.
This Agreement may not be modified or amended other than by an agreement in
writing.
(h) Paragraph Headings. The Paragraph and subparagraph headings in
this Agreement have been inserted for convenience of reference only; they form
no part of this Agreement and shall not affect its interpretation.
(i) Gender, Etc. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context indicates is appropriate.
(j) Number of Days. In computing the number of days for purposes of
this Agreement, all days shall be counted, including Saturdays, Sundays and
Holidays; provided, however, that if the final day of any time period falls on a
Saturday, Sunday or Holiday, then the final day shall be deemed to be the next
day which is not a Saturday, Sunday or Holiday. For
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purposes of this Agreement, the term "Holiday" shall mean a day, other than a
Saturday or Sunday, on which national banks with branches in the Commonwealth of
Pennsylvania are or may elect to be closed.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
on the date first above written.
Attest: PINNACLE FOODS, INC.
_______________________________ BY:____________________________
Xxxxxx XxXxxxx, Secretary Xxxxxxx X. Xxxxx, President
Witness:
_______________________________ ______________________(SEAL)
Xxxxxx Xxxxx
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