EXHIBIT 10.21
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EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as
of September 13, 1996, by and between Sun World International, Inc.,
a Delaware corporation (the "Company"), Cadiz Land Company, Inc.
("Cadiz") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, an individual ("▇▇▇▇▇").
WHEREAS, the Company is a wholly-owned subsidiary of Cadiz; and
WHEREAS, the Company wishes to employ ▇▇▇▇▇ and ▇▇▇▇▇ wishes to
accept such employment on the terms and conditions set forth herein;
NOW, THEREFORE, the parties agree as follows:
1. TERM OF EMPLOYMENT.
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The Company hereby employs ▇▇▇▇▇ and ▇▇▇▇▇ accepts such
employment for a term commencing as of September 13, 1996 (the
"Commencement Date"), and terminating as provided in Section 6 below
(the "Term").
2. DUTIES.
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▇▇▇▇▇ shall be employed as the Senior Vice-President, Chief
Financial Officer and Secretary of the Company. ▇▇▇▇▇'▇ base of
operations shall be at the new corporate headquarters office of the
Company (to be located in Los Angeles County at a site to be
determined by the Company), unless changed by mutual agreement.
However, ▇▇▇▇▇ shall also render services at the sites of the
Company's operating divisions (currently based in Bakersfield and
Coachella, California) as necessary to properly perform his duties.
▇▇▇▇▇'▇ duties and responsibilities shall relate, generally, to all
financial and administrative areas of the Company including finance,
treasury, human resources, management information systems and the
legal department. ▇▇▇▇▇ shall report to, and take direction from, the
Chief Executive Officer of the Company. ▇▇▇▇▇ shall also perform such
other duties pertaining to the operations of the Company as the Board
of Directors of the Company (the "Board") may from time to time
direct. ▇▇▇▇▇ shall attend all quarterly meetings of the Board.
▇▇▇▇▇ hereby consents to serve in further capacities as an officer
and/or director of the Company or any subsidiary or affiliate without
any additional salary or compensation.
3. NECESSARY SERVICES.
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a. PERFORMANCE OF DUTIES. ▇▇▇▇▇ agrees that he will at
all times faithfully, industriously and to the best of his ability,
experience and talents, perform to the reasonable satisfaction of the
Company all of the duties that may be assigned to him hereunder and
shall devote such time to the performance of these duties as may be
necessary therefor.
b. FULL-TIME SERVICE. During the term of the Agreement,
▇▇▇▇▇ shall be available on a full-time basis to perform the duties
assigned him in accordance with paragraph 2 hereof; provided, however,
that nothing herein shall preclude ▇▇▇▇▇ from spending a reasonable
amount of time in the management of his personal investments or with
any charitable or civic venture with which ▇▇▇▇▇ may be involved as
of the date hereof; and provided, further, that such involvement shall
not detract from the performance of ▇▇▇▇▇'▇ duties hereunder.
c. EXCLUSIVE SERVICES. ▇▇▇▇▇ agrees that during the
period of his employment, ▇▇▇▇▇ shall provide services exclusively
pursuant to this Agreement, and ▇▇▇▇▇ will not, without the prior
written consent of the Company (which consent may be granted or
withheld in the sole and absolute discretion of the Company), directly
or indirectly:
(i) engage in the business of, or own or control any
interest in (except as a passive investor owning less than 10% of the
equity securities of a publicly held company), or act as director,
officer of employee of, or consultant to, any individual, partnership,
joint venture, corporation or other business entity, directly or
indirectly engaged anywhere in the United States, its possessions or
territories, in any business competitive with the business then being
carried on by the Company or any affiliate;
(ii) plan or organize any business activity
competitive with the business or planned business of the Company or
its affiliates, or combine, participate, or conspire with other
employees of the Company or its affiliates or other persons or
entities for the purpose of organizing any such competitive business
activity; or
(iii) divert or take away, or attempt to divert or
take away, any of the customers or potential customers of the Company
or its affiliates, either for himself or for any other person, firm,
partnership, corporation or other business entity.
4. BASIC COMPENSATION.
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Subject to such deductions as the Company may from time to
time be required to make pursuant to law, governmental regulation or
order, the Company agrees to pay to ▇▇▇▇▇ an initial base salary of
$225,000 per annum, commencing as of the Commencement Date. Payments
shall be made in accordance with the normal payroll practices of the
Company. Such base salary will be subject to annual adjustment by the
Compensation Committee of the Board, in its sole and absolute
discretion.
▇▇▇▇▇ agrees to accept the foregoing, along with any other
compensation to which ▇▇▇▇▇ may be entitled under Section 5 below, as
payment in full for all services rendered by him to or for the benefit
of the Company.
5. OTHER COMPENSATION.
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a. STOCK OPTIONS. Concurrently with the execution hereof,
Cadiz shall grant to ▇▇▇▇▇, for a period of five (5) years from the
date hereof (the "Option Date"), the right and option to purchase
200,000 theretofore authorized but unissued common shares of Cadiz at
the price of $4.50 per share, which represents the market value of
Cadiz's common stock upon the Option Date. The options so granted
(the "Options") shall be issued under the Cadiz 1996 Stock Option Plan
(the "Plan") and shall be subject to vesting, if at all, as follows:
(i) VESTING - SIX MONTHS. 100,000 Options shall vest
and shall be immediately exercisable by ▇▇▇▇▇ six months following the
Commencement Date.
(ii) CONDITIONAL STOCK OPTIONS - 1996 EARNINGS.
25,000 Options shall vest, if at all, and shall be immediately
exercisable by ▇▇▇▇▇, upon the certification by the independent
outside auditors of the Company that the Company has achieved earnings
before interest, taxes, depreciation and amortization (before
extraordinary professional fees relating to the reorganization of the
Company and before any extraordinary gains from asset sales) (the
"EBITDA Amount") for the year ended December 31, 1996 of $20,530,000
or more (prior to the payment of any management fees by the Company
to Cadiz). In the event of a change in the fiscal year end of the
Company, suitable pro-rata adjustments shall be made to the foregoing
EBITDA Amount.
(iii) CONDITIONAL STOCK OPTIONS - BOARD DISCRETION.
25,000 Options shall vest, if at all, and shall be immediately
exercisable by ▇▇▇▇▇, at the discretion of the Board of Directors of
Cadiz, based upon the Board's good faith evaluation of ▇▇▇▇▇'▇
performance during the first year of ▇▇▇▇▇'▇ employment hereunder.
(iv) CONDITIONAL STOCK OPTIONS - 1997 EARNINGS.
25,000 Options shall vest, if at all, and shall be immediately
exercisable by ▇▇▇▇▇, upon the certification by the independent
outside auditors of the Company that the Company has achieved an
EBITDA Amount for the year ended December 31, 1997 in an amount to be
established by the agreement of ▇▇▇▇▇ and the Chairman of the Company
prior to the commencement of such year.
(v) CONDITIONAL STOCK OPTIONS - BOARD DISCRETION.
25,000 Options shall vest, if at all, and shall be immediately
exercisable by ▇▇▇▇▇, at the discretion of the Board of Directors of
Cadiz, based upon the Board's good faith evaluation of ▇▇▇▇▇'▇
performance for the year ended December 31, 1997.
(vi) ADDITIONAL CONDITIONS TO OPTIONS.
Nothwithstanding anything to the contrary herein, no Option shall be
exercisable until such date as the stockholders of Cadiz have approved
the Plan and have approved an increase in the authorized capital stock
of Cadiz in an amount sufficient to permit exercise of the Options.
It shall be a further condition to the grant and vesting of any
options described in this paragraph 5(a) that (a) concurrently with
the grant of such options, ▇▇▇▇▇ shall provide to Cadiz such written
documentation, including representations and warranties, as Cadiz may
require in order to establish compliance with any applicable state or
federal securities laws, and (b) at the time of vesting, ▇▇▇▇▇ shall
be an active employee of the Company. It shall also be a condition
to the grant and vesting of any options described in subsections
5(a)(ii) and 5(a)(iv) that ▇▇▇▇▇ be an employee of the Company at the
end of the fiscal year to which such options relate.
b. CASH BONUSES.
(i) MANDATORY BONUSES. ▇▇▇▇▇ will be entitled to
receive a Supplemental Bonus during the first two years of ▇▇▇▇▇'▇
employment as follows:
(a) YEAR ENDED DECEMBER 31, 1996. ▇▇▇▇▇ will be
eligible to receive a cash bonus equal to 50% of ▇▇▇▇▇'▇ annual
base salary (as determined on an annualized basis for such year,
but pro-rated for the period August 15, 1996 - December 31,
1996) (the "1996 Bonus Base Salary"), as follows. If the
Company achieves 100% of its budgeted EBIDTA Amount for the year
ended December 31, 1996 (i.e. $20,530,000), ▇▇▇▇▇ will be paid
a cash bonus equal to 25% of ▇▇▇▇▇'▇ 1996 Bonus Base Salary.
▇▇▇▇▇ will also be eligible for a cash bonus, in an amount not
to exceed 25% of ▇▇▇▇▇'▇ 1996 Bonus Base Salary, at the
discretion of the Board of Directors of the Company, based upon
the Board's good faith evaluation of ▇▇▇▇▇'▇ performance during
the year ended December 31, 1996. The cash bonus described in
this paragraph will be payable promptly following certification
by the independent outside auditors of the Company of the
Company's EBITDA Amount for the year.
(b) YEAR ENDED DECEMBER 31, 1997. ▇▇▇▇▇ will be
eligible to receive a cash bonus equal to 50% of ▇▇▇▇▇'▇ annual
base salary (as determined on an annualized basis for such year)
(the "1997 Bonus Base Salary"), as follows. A cash bonus of 25%
of the 1997 Bonus Base Salary will be payable to ▇▇▇▇▇ for the
year ended December 31, 1997 on the basis as described in
subparagraph (a) above, except that the Company's budgeted
EBITDA Amount for such year shall be established by the
agreement of ▇▇▇▇▇ and the Chairman of the Company prior to the
commencement of such year. ▇▇▇▇▇ will also be eligible for a
cash bonus, in an amount not to exceed 25% of ▇▇▇▇▇'▇ 1997 Bonus
Base Salary, at the discretion of the Board of Directors of the
Company, based upon the Board's good faith evaluation of ▇▇▇▇▇'▇
performance for the year ended December 31, 1997. The cash
bonus described in this paragraph will be payable promptly
following certification by the independent outside auditors of
the Company of the Company's EBITDA Amount for the year.
(c) ADDITIONAL CONDITIONS TO BONUSES. It shall
be a further condition to the payment of any bonuses described
in this paragraph 5(b)(i) that ▇▇▇▇▇ be an employee of the
Company at the end of the fiscal year to which such bonuses
relate.
(ii) DISCRETIONARY BONUSES. The Company may grant to
▇▇▇▇▇ annual bonuses in further compensation and as special
recognition for his services to the Company. Any such bonuses, which
shall not be mandatory, may be granted in the sole discretion of the
Board of Directors of the Company and at such times and in such manner
as the Board of Directors of the Company may determine.
c. FRINGE BENEFITS. In addition to the compensation set
forth above, ▇▇▇▇▇ shall be entitled to the following benefits:
i. Four (4) weeks annual vacation during each of the
first two years of employment, provided that no more than two weeks
are to be taken consecutively;
ii. Sick leave and personal leave with pay in
accordance with the prevailing policies of the Company;
iii. Medical coverage under the group medical insurance
plan of the Company (or COBRA coverage, at the election of ▇▇▇▇▇);
iv. Participation in any pension plan maintained by
the Company for the general benefit of its employees;
v. At ▇▇▇▇▇'▇ option, either (i) the Company shall
pay to ▇▇▇▇▇ an automobile allowance of $650 per month, or (ii) the
Company, at its expense, shall furnish to ▇▇▇▇▇ a fully equipped
automobile of comparable value for use during the term of this
Agreement; and
vi. Any other benefits not specifically set forth
herein as may be granted by the Company or Cadiz, in its sole and
absolute discretion.
d. DEDUCTION AND REIMBURSEMENT. ▇▇▇▇▇ hereby agrees that
the Company may deduct and withhold from the compensation payable to
▇▇▇▇▇ hereunder any amounts of money required to be deducted or
withheld by the Company under the provisions of any and all applicable
local, state or federal statutes or regulations or any amendments
thereto hereafter enacted requiring the withholding or deducting of
compensation. In the event the Company makes any payments or incurs
any charges for ▇▇▇▇▇'▇ account, the Company shall have the right, and
▇▇▇▇▇ hereby authorizes the Company, to deduct from any compensation
payable to ▇▇▇▇▇ hereunder any charges so paid or incurred by the
Company, but such right of deduction shall not be deemed to limit or
exclude any other rights of credit or recovery or any other remedies
the Company otherwise may have. Nothing hereinabove set forth shall
be deemed to obligate the Company to make any such payments or incur
any such charges. If it is determined that such deduction is
unauthorized, the Company agrees to reimburse ▇▇▇▇▇ promptly, it being
understood, however, that notwithstanding the determination that any
deduction was unauthorized, the making of such deductions shall not
be deemed to be a breach by the Company of any of its obligations to
▇▇▇▇▇ hereunder.
6. TERMINATION.
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a. Except as provided in subsection (b) below, this
Agreement shall terminate:
i. At the election of the Company, upon the death or
permanent disability of ▇▇▇▇▇, "permanent disability" being defined
as any continuous loss of one-half (1/2) or more of the time spent by
▇▇▇▇▇ in the usual daily performance of his duties as a result of
physical or mental illness for a continuous period in excess of ninety
(90) days.
ii. At such time, if any, as the Company ceases to
conduct business for any reason whatsoever.
iii. At the election of the Company, upon the breach
by ▇▇▇▇▇ of any term or condition of this Agreement or upon the
dismissal of ▇▇▇▇▇ by the Company for cause. For purposes of this
Agreement, the Company shall have "cause" to terminate ▇▇▇▇▇'▇
employment if he (1) engages in one or more acts constituting a
felony; (2) engages in one or more acts involving fraud or serious
moral turpitude; or (3) misappropriates Company assets or engages in
gross misconduct materially injurious to the Company or its affiliates
or subsidiaries.
iv. During the first year of employment hereunder, at
any time upon 180 days' written notice of termination by either party
to the other, and thereafter at any time upon 90 days' written notice
of termination by either party to the other. Such termination may be
with or without cause for any reason whatsoever, whether arbitrary or
not, provided, however, that any amount due under Section 4 hereof
shall be prorated as of the date of termination and the amount so
determined to be due and payable hereunder shall be paid within thirty
(30) days after said date of termination to ▇▇▇▇▇ or his estate, as
applicable. The Company shall have no further obligation under this
Agreement to make any payments to, or bestow any benefits upon, ▇▇▇▇▇
after the date of termination; provided, however, that termination of
this Agreement shall not affect the right of ▇▇▇▇▇ to exercise any
theretofore vested options granted pursuant to Section 5(a) above.
b. RETURN OF COMPANY'S PROPERTY. If this Agreement is
terminated for any of the foregoing reasons, the Company may, at its
option, require ▇▇▇▇▇ to vacate his offices prior to the effective
date of a termination and to cease all activities on the Company's
behalf. ▇▇▇▇▇ agrees that on the termination of his employment in any
manner, he will immediately deliver to the Company all notebooks,
brochures, documents, memoranda, reports, price lists, files,
invoices, purchase orders, books, correspondence, customer lists, or
other written or graphical records, and the like, relating to the
business or work of the Company, which are or have been in his
possession or under his control and which have not been returned to
the Company. ▇▇▇▇▇ hereby expressly acknowledges that all such
materials referenced above are the property of the Company.
c. PUBLIC IDENTIFICATION. If this Agreement is terminated
pursuant to any provision of this Section 6, ▇▇▇▇▇ shall immediately
and forever thereafter cease to hold himself out to any person, firm,
partnership, corporation or other entity as an employee, agent,
independent contractor or representative of the Company or of any
entity owned by, or affiliated with, the Company.
7. EXPENSES.
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The Company shall reimburse ▇▇▇▇▇ for all out-of-pocket
expenses incurred by ▇▇▇▇▇ in the performance of his duties hereunder,
including, but not limited to, telephone, travel, and office expenses,
all subject to such written guidelines and/or requirements for
verification as the Company may, in its sole and absolute discretion,
establish.
8. CONFIDENTIALITY AND TRADE SECRETS.
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For purposes of this Section 8, the term "Company" shall
collectively refer to the Company and any affiliate thereof.
a. CONFIDENTIAL INFORMATION. ▇▇▇▇▇ shall keep in
strictest confidence all information relating to the business,
affairs, customers and suppliers of the Company (collectively
hereinafter referred to as "Trade Secrets"), including, among other
things but without limitation, the Company's cost of performing
services, pricing formulae, methods or procedures, and customer lists,
which ▇▇▇▇▇ may acquire during the performance of his services and
duties hereunder and which is not otherwise generally known to the
public. ▇▇▇▇▇ acknowledges that such Trade Secrets are of great
value, and have been developed and/or acquired at great expense to the
Company, and the Company would not enter into this contract of
employment and such information would not be made available to ▇▇▇▇▇
in ▇▇▇▇▇'▇ fiduciary capacity unless the Company were assured that all
such information will be used for the exclusive benefit of the
Company. Accordingly, during the term of this Agreement, and at all
times thereafter, ▇▇▇▇▇ shall not publish, communicate, divulge,
disclose or use, whether or not for his own benefit, any such
information without the prior written consent of the Company.
Further, ▇▇▇▇▇ agrees that during the period of his employment, ▇▇▇▇▇
will not, directly or indirectly, engage in the business of, or own
or control any interest in (except as a passive investor owning less
than 10% of the equity securities of a publicly held company), or act
as a director, officer of employee of, or consultant to, any
individual, partnership, joint venture, corporation or other business
entity, directly or indirectly engaged anywhere in the United States,
its possessions and territories, in any business competitive with the
business then being carried on by the Company; nor will ▇▇▇▇▇ engage
in any such activity following the termination of his employment
hereunder (however and by whomever caused and irrespective or whether
or not such termination is for cause), if the loyal and complete
fulfillment by ▇▇▇▇▇ of such activities would demand, inherently, that
▇▇▇▇▇ reveal Trade Secrets.
b. CUSTOMER INFORMATION. ▇▇▇▇▇ hereby specifically agrees
that he will not utilize any information concerning the customers of
the Company which ▇▇▇▇▇ acquires during the term of this Agreement,
whether or not the same originated through ▇▇▇▇▇'▇ efforts, for any
purpose detrimental to the business of the Company. Without
limitation of the foregoing, ▇▇▇▇▇ agrees that he shall not at any
time interfere with any existing contracts of the Company, and further
agrees that he shall not engage in business discussions with any
person or entity with whom he or the Company are in negotiations at
the time he ceases to be an employee of the Company until after such
negotiations have been concluded.
c. SOLICITATION OF EMPLOYEES. ▇▇▇▇▇ acknowledges that
important factors in the Company's business and operations are the
loyalty and good will of its employees and its customers.
Accordingly, ▇▇▇▇▇ agrees that both during the term of this Agreement
and after the expiration or termination of this Agreement he will not
enter into, and will not participate in, any plan or arrangement to
cause any of the Company's employees to terminate his employment with
the Company or hire any of such employees in connection with business
initiated by ▇▇▇▇▇ or any other person, firm or corporation. ▇▇▇▇▇
further agrees that information as to the capabilities of the
Company's employees, their salaries and benefits, and the other terms
of their employment is confidential and proprietary to the Company and
constitutes its valuable trade secrets.
d. ONGOING OBLIGATION. The provisions in this Section 8
shall be binding during ▇▇▇▇▇'▇ employment and at all times
thereafter, regardless of the circumstances or reasons for termination
of this Agreement. In the event the provisions in this Section 8 are
more restrictive than permitted by the laws of the jurisdiction in
which enforcement of this provision is sought, such provisions shall
be interpreted to extend only over the maximum period of time, range
of activities or geographic area as to which it may be enforceable.
9. REMEDY FOR BREACH.
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▇▇▇▇▇ acknowledges that the services to be rendered by him
hereunder are of a special, unique and extraordinary character, which
gives this Agreement a peculiar value to the Company, the loss of
which cannot be reasonably or adequately compensated in damages in an
action at law, and a breach by ▇▇▇▇▇ of the provisions of this
Agreement will cause the Company irreparable injury. It is,
therefore, expressly acknowledged that this Agreement may be enforced
by injunction and other equitable remedies, without bond. Such relief
shall not be exclusive, but shall be in addition to any other rights
or remedies Company may have for such breach, and Company shall be
entitled to recover all costs and expenses, including reasonably
attorneys' fees, incurred by reason of any breach of the covenants of
this Agreement.
10. LITIGATION AND ATTORNEYS FEES.
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In the event of any litigation between the parties hereto
in connection with this Agreement or to enforce any provision or right
hereunder, the unsuccessful party to such litigation shall pay to the
successful party therein all costs and expenses, including but not
limited to reasonable attorneys' fees incurred therein by such
successful party, which costs, expenses and attorneys' fees shall be
included as a part of any judgment rendered in such action in addition
to any other relief to which the successful party may be entitled.
11. GENERAL PROVISIONS.
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a. The failure of the Company at any time to enforce
performance by ▇▇▇▇▇ of any provisions of this Agreement shall in no
way affect the Company's rights thereafter to enforce the same, nor
shall the waiver by the Company of any breach of any provision hereof
be held to be a waiver of any other breach of the same or any other
provision.
b. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and the successors and assigns of the
Company; provided, however, it is understood and agreed that the
services to be rendered and the duties to be performed by ▇▇▇▇▇
hereunder are of a special, unique and personal nature and that it
would be difficult or impossible to replace such services; by reason
thereof, ▇▇▇▇▇ may not assign either the benefits or the obligations
of this Agreement.
▇. ▇▇▇▇▇ shall be considered an employee of the Company
within the meaning of all federal, state and local laws and
regulations governing unemployment insurance, workers' compensation,
industrial accident, labor and taxes.
d. This Agreement is the entire agreement between the
parties hereto with respect to the subject matter hereof and
supersedes all prior oral and written agreements and negotiations
between the parties.
e. The headings of the several paragraphs in this
Agreement are inserted solely for the convenience of the parties and
are not a part of and are not intended to govern, limit or aid in the
construction of any term or provision hereof.
f. This Agreement may not be modified except by a written
instrument signed by all parties hereto.
g. All clauses and covenants contained in this Agreement
are severable, and in the event any of them shall be held to be
invalid by any court, such clauses or covenants shall be limited as
permitted under applicable law, or, if the same are not susceptible
to such limitation, this Agreement shall be interpreted as if such
invalid clauses or covenants were not contained herein.
h. This Agreement is made with reference to the laws of
the State of California and shall be governed by and construed in
accordance therewith. Any litigation concerning or to enforce the
provisions of this Agreement shall be brought in the courts of the
State of California.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
▇▇▇▇▇:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
THE COMPANY
Sun World International, Inc.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
Chief Executive Officer
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Chairman
CADIZ
Cadiz Land Company, Inc.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇, Chairman
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
Chief Executive Officer
