Exhibit 10(r)
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made this 1st day of March, 2001, between Minn-Dak
Farmers Cooperative, a cooperative association organized and existing under the
laws of the State of North Dakota, with its principal office located at 0000 Xxx
Xxxxx Xxxx, Xxxxxxxx, Xxxxx Xxxxxx 00000, referred to in this agreement as
"Minn-Dak", and Xxxxx X. Xxxxx, of 0 Xxxxx Xxxx Xxxx, Xxxxxxxx, Xxxxxxx, 00000,
referred to in this agreement as "Roche".
SECTION ONE
EMPLOYMENT
Minn-Dak employs Roche, and Roche accepts such employment, upon the terms and
conditions set forth in this agreement.
SECTION TWO
DUTIES AND AUTHORITY
X. Xxxxx will occupy the position of President and Chief Executive Officer
with Minn-Dak.
B. In this position, Roche will have the powers of a President and Chief
Executive Officer, subject to the control of the board of directors,
and have general supervision, direction and control over the business
and affairs of the cooperative and its employees. Roche will be
primarily responsible for carrying out all orders and resolutions of
the board of directors and such duties as may from time to time be
assigned to him by the board of directors.
X. Xxxxx agrees to devote his full time, attention and best efforts to the
performance of employment under this agreement.
X. Xxxxx will not, during the term of this agreement, directly or
indirectly engage in any business, either as an employee, employer,
consultant, principal, corporate officer, or in any other capacity,
whether or not compensated, without the prior written consent of the
board of directors.
SECTION THREE
TERMS OF EMPLOYMENT
The initial term of employment shall be for eighteen (18) months commending
March 1, 2001 and expiring August 31, 2002. Thereafter, upon renewal of this
agreement by the parties, employment shall extend until terminated as provided
for in this agreement.
SECTION FOUR
COMPENSATION AND PERFORMANCE REVIEW
Roche shall receive compensation during the term of this agreement as follows:
A. During the initial eighteen (18) months term of employment, as base
salary of $265,000/year payable bi-weekly pursuant to Minn-Dak's
current payroll program.
B. Minn-Dak's board of directors shall conduct a performance review of
Roche in the position of President and Chief Executive Officer every
six months during the initial 18 month term and annually thereafter.
Upon completion of the initial term and upon continued employment,
annually thereafter, upon completion of the performance review, Roche
shall be eligible for an increase in base salary, the amount of which
shall be at the discretion of and as authorized by the board of
directors.
C. Upon completion of the initial 18 month term and annually thereafter,
upon continued employment, a profit sharing bonus shall be paid based
on the following schedule:
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RETURN/ACRE TO GROWERS Profit Sharing Amount to CEO
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$700 - $749 $10,000
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$750 - $799 $20,000
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$800 - $849 $30,000
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$850 - $899 $40,000
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Over $900 $50,000
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Return per acre shall be the amount received by the shareholder/growers as a
grower payment for sugarbeets and shall not include patronage, retains, or
trucking payments.
D. The board of directors may at its discretion grant a performance bonus
to Roche regardless of whether a profit sharing bonus has been awarded.
SECTION FIVE
RELOCATION AND TRANSITION
The parties acknowledge that Roche shall be relocating to the Minn-Dak area and
will incur certain related expenses. Minn-Dak shall provide relocation
assistance as follows:
X. Xxxxx shall receive reimbursement for the actual costs incurred for
packing and moving furniture and other household goods including meals,
lodging and mileage for two vehicles from Savannah, Georgia to
Wahpeton, North Dakota, or such other location in the area where they
wish to reside, including Fergus Falls, Minnesota.
B. Minn-Dak shall provide a $4500 moving allowance to Roche for additional
miscellaneous moving expenses.
C. Minn-Dak shall provide temporary living expenses to Roche for a maximum
of 90 days including motel or other housing plus a per diem of
$150/week for meals.
D. Minn-Dak shall provide a $4000 budget to Roche for a 90 day period for
trips back and forth to sell his Savannah house and settle affairs.
E. In the event Roche should attend meetings on behalf of Minn-Dak at the
request of the board of directors, prior to his employment date, he
shall receive a per diem of $1000 per full day plus expenses.
SECTION SIX
MEDICAL AND GROUP INSURANCE
Roche shall be included in, or have available, insurance plans provided at
Minn-Dak as follows:
A. Health/prescription drug, dental and vision insurance through the plan
available at Minn-Dak subject to the non-union contribution amounts
applicable to office employees, coverage effective March 1, 2001.
B. If Roche retires as CEO from Minn-Dak on or after his 62nd birthday,
medical insurance as then available through Minn-Dak will be provided
to the CEO until he reaches age 65. Post age 65 coverage shall be open
for later discussion.
C. Term Life Insurance coverage equal to 2 times salary under Minn-Dak's
current plan, coverage effective March 1, 2001.
D. Option Employee paid additional Term Life Insurance including
qualifying dependents under Minn-Dak's current plan.
E. Accidental Death and Dismemberment Insurance under Minn-Dak's current
plan.
F. Optional Employee paid Additional Accident Death and Dismemberment
Insurance including qualifying dependents through Minn-Dak's current
plan.
G. Long Term Disability Insurance through Minn-Dak's current plan.
H. Optional Employee paid Individual Disability Insurance coverage through
Minn-Dak's current plan.
SECTION SEVEN
PENSION AND OTHER BENEFIT PLANS
Roche shall be included in, or have available, pension and other benefit plans
provided at Minn-Dak as follows:
A. A Flexible Spending Account under the terms for employees of Minn-Dak.
B. Voluntary Employee paid Non-qualified Deferred Compensation Plan under
Minn-Dak's current plan which is available at the time of hire.
C. A Defined Benefit Pension Plan under Minn-Dak's current plan which
requires completion of 12 months service from date of hire for
eligibility.
D. Upon renewal of this Employment Agreement upon completion of the 18
month initial term, the Supplemental Executive Retirement Plan (SERP)
currently in place at Minn-Dak shall be provided to Roche to cover
compensation in excess of the annual IRS compensation limit for the
Defined Benefit Pension Plan. Upon renewal of the employment contract,
SERP coverage shall be retroactive to the earliest eligibility date,
which is currently upon completion of 12 months service from date of
hire.
E. A 401(k) Salary Reduction Plan under Minn-Dak's current plan which
requires completion of 12 months service for eligibility. The current
matching contribution rate is 75% of the first 4% of compensation,
provided that the employee contributes at least 4% to the plan.
SECTION EIGHT
VACATION, HOLIDAYS AND SICK LEAVE
A. During the initial 18 month employment term, Roche shall have 3 weeks
vacation during the first year and 4 weeks per year after the first
year. Increases in vacation time over and above 4 weeks shall be at the
discretion of the board of directors. Company policy encourages the use
of vacation time from one anniversary date to the next anniversary date
with a maximum carryover of 240 hours of vacation from one period to
the next.
B. Commending on the date of hire, paid Designated Holidays under
Minn-Dak's current program - a total of seven (7) days: New Year's Day;
Good Friday; Memorial Day; Independence Day; Labor Day; Thanksgiving
Day; and Christmas Day.
C. During the first year of employment, Roche shall have two (2) days,
eight (8) hours each, of paid floating holidays. After one (1) year of
continuous service, he shall have paid Floating Holidays under
Minn-Dak's current program - a total of four (4) days eight (8) hours
each. This allotment is applicable each year thereafter.
D. Additional Personal Floating Holiday under Minn-Dak's current program -
awarded on second anniversary or 12 consecutive months thereafter for
not using any sick leave during the previous 12 months.
E. Sick Leave under Minn-Dak's current program of 80 hours is earned after
one (1) year of continuous service - 80 hours per year to accrual of
520 hours with a 40 hours per year thereafter to accrual of 1040 hours.
Sick leave is available to employees with less than one (1) year of
continuous service. Any sick leave taken will be deducted from the 80
hour allotment when earned, or deducted from final pay if employment is
terminated in less than 1 year.
SECTION NINE
EXPENSE REIMBURSEMENT
A. While on Minn-Dak business, Roche shall be reimbursed for travel
expenses. If his spouse is required to travel with him for business,
Minn-Dak will pay his spouse's expenses. While encouraged, business
travel by a spouse is usually not required, but if it is done in
conjunction with industry meetings where registration is paid, Minn-Dak
will pay the registration fees for the spouse. There may be times that
all of the spouse's travel expenses will be reimbursed regardless of
whether registration is paid for the event.
B. For business miles driven, reimbursement for mileage will be paid
subject to Internal Revenue Service reporting and restrictions
(presently $.345/mile with mileage log required). Upon renewal of the
employment contract at the completion of the 18 month initial term,
this reimbursement shall be reviewed to determine its appropriateness
based on the miles traveled during the initial term.
C. Minn-Dak may provide Roche with a credit card for payment of business
expenses. Such card shall be used by Roche only for expenses of
Minn-Dak's business for which Roche would be entitled to reimbursement
under this section. Any use of such card by Roche for any other purpose
shall constitute an indebtedness of Roche to Minn-Dak which shall be
paid immediately upon demand and shall bear interest at the highest
rate allowed by law. Roche may not use the credit card for his personal
expenses.
SECTION TEN
TERMINATION
A. Effective for the initial eighteen (18) month term:
1. If at the conclusion of 9 months service of the initial 18
month term, Minn-Dak determines that it will not be renewing
this Employment Agreement, Minn-Dak must give notice at that
time.
2. If Roche determines he wishes to terminate his employment with
Minn-Dak at the end of the 18 month initial term, he shall
give notice of such intent 9 months prior to the end of the 18
month term.
B. Upon the renewal of this Employment Agreement at the end of the initial
eighteen (18) month term for additional twelve (12) month terms, any
renewal of this agreement may be terminated by any of the following:
1. Either party may terminate this agreement by giving written
notice to the other party at least 90 days prior to the
expiration of any twelve (12) month term.
2. Minn-Dak may terminate this agreement on written notice to
Roche for material breach or just cause. "Material breach" and
"just cause" shall mean willful misconduct in following the
legitimate directions of the board of directors; breach of
loyalty to the cooperative; conviction of a felony; habitual
drunkenness; excessive absenteeism not related to illness,
sick leave or vacations, but only after notice from the board
of directors followed by a repetition of such excessive
absenteeism; dishonesty; or continuous conflicts of interest
after notice in writing from the board of directors.
3. This agreement shall automatically terminate as of Roche's
death, and Minn-Dak's monetary obligations to Roche as set
forth in this agreement (exclusive of any death benefits to
which Roche's beneficiaries are entitled under this agreement)
shall be prorated to the date of death and paid to Roche's
estate, including but not limited to the salary, bonuses,
vehicle reimbursement, other reimbursements, insurance and
benefits.
4. Minn-Dak shall have the right to terminate this agreement,
after giving Roche ten (10) days' written notice of its
intention to do so, should Roche, because of "total and
permanent disability", be unable to perform any duties
required of him under this agreement for a period of ninety
(90) consecutive days. The term "total and permanent
disability" shall mean the existence of permanent mental or
physical disability, determined by a physician in accordance
with generally accepted medical principles, which renders
Roche totally unable to perform any material covenants,
obligations or terms contained in the agreement. In the event
of such termination, Roche shall continue to receive from
Minn-Dak any and all salaries, bonuses, and benefits during
such ninety (90) day period.
SECTION ELEVEN
PHYSICAL EXAMINATION
Roche shall submit to an annual physical examination prior to August 31 of each
year. Said medical examination shall be at Minn-Dak's expense with a report from
the physician being provided to the Chairman of the Board prior to August 31 of
each year.
SECTION TWELVE
PROVIDED EQUIPMENT
A. If desired by Roche, a Laptop computer will be provided by Minn-Dak.
X. Xxxxx shall be provided with a cell phone for Minn-Dak business. Roche
shall be responsible for any personal usage.
C. Upon request being made to the board of directors, Roche shall be
provided with such other technology as he shall deem desirable and
helpful in carrying out his employment duties.
SECTION THIRTEEN
NOTICES
Any notice provided for in this agreement shall be given in writing. Notices
shall be effective from the date of service, if served personally on the party
to whom notice is to be given, or on the second day after mailing, if mailed by
first class mail, postage prepaid. Notices shall be properly addressed to the
parties at their respective addresses or to such other address as either party
may later specify by notice to the other.
SECTION FOURTEEN
ENTIRE AGREEMENT
This agreement contains the entire agreement and supersedes all prior agreements
and understandings, oral or written, with respect to the subject matter of this
agreement. This agreement may be changed only by an agreement in writing signed
by both parties.
SECTION FIFTEEN
WAIVER
The waiver by Minn-Dak of a breach of any of the provisions of this
agreement by Roche shall not be construed as a waiver of any subsequent breach
by him.
SECTION SIXTEEN
GOVERNING LAW; VENUE
This agreement shall be construed and enforced in accordance with the
laws of the State of North Dakota. Richland County, North Dakota, shall be the
proper venue for any litigation arising out of this agreement.
SECTION SEVENTEEN
SECTION HEADINGS
Section headings are for convenience only and are not intended to
expand or restrict the scope or substance of the provisions of this agreement.
SECTION EIGHTEEN
ASSIGNABILITY
The rights and obligations of Minn-Dak under this agreement shall inure
to the benefit of and shall be binding upon its successors and assigns. This
agreement is a personal employment agreement and Roche's rights, obligations and
interests under this agreement may not be sold, assigned, transferred, pledged
or hypothecated.
SECTION NINETEEN
SEVERABILITY
If any provision of this agreement is held by a court of competent
jurisdiction to be invalid or unenforceable, the remainder of the agreement
shall remain in full force and shall be in no way impaired.
In witness of the above, each party to this agreement has caused it to
be executed on the date indicated below.
MINN DAK FARMERS COOPERATIVE ROCHE
BY /s/ Xxxxxx Xxxxxxxxxxx /s/ Xxxxx X. Xxxxx
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Xxxxxx Xxxxxxxxxxx, Chairman Xxxxx X. Xxxxx
of the Board of Directors
DATE: 3-1-01 DATE: 3-01-01
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STATE OF NORTH DAKOTA )
) SS
COUNTY OF RICHLAND )
The foregoing instrument was acknowledged before me this 1st day of
March, 2001, by Xxxxxx Xxxxxxxxxxx, Chairman of the Board of Directors of
Minn-Dak Farmers Cooperative, on behalf of said cooperative.
XXXXXX X. XXXXXXXX
Notary Public, Richland Co., N. Dak.
My Commission Expires Aug. 31, 0000
XXXXX XX XXXXX XXXXXX
NOTARY PUBLIC SEAL /s/ Xxxxxx X. Xxxxxxxx
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Notary Public
The foregoing instrument was acknowledged before me this 1st day of
March, 2001, by Xxxxx X. Xxxxx.
XXXXXX X. XXXXXXXX
Notary Public, Richland Co., N. Dak.
My Commission Expires Aug. 31, 0000
XXXXX XX XXXXX XXXXXX
NOTARY PUBLIC SEAL /s/ Xxxxxx X. Xxxxxxxx
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Notary Public
