Exhibit 10.5
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made and entered into
between Overhill Farms, Inc., a Nevada Corporation (the "Company") and Xxxxxx
Xxxxxxx (the "Employee"), a resident of Huntington Beach, California, as of the
first day of November, 1999.
ARTICLE I
Section 1.1: Employment. The Company hereby employs the Employee
as Senior Vice President and Chief Financial Officer
of the Company, and Employee hereby accepts
employment in such capacity, upon and subject to the
terms and conditions of this Agreement.
ARTICLE II
Section 2.1: Term. Subject to the provisions for termination
hereinafter, provided, the initial terms of this
Agreement shall begin on the 1st day of November,
1999, and shall end three (3) years thereafter. This
Agreement shall continue from year to year thereafter
unless terminated by either party hereto as herein
provided.
Section 2.2: Compensation. For all services rendered by the
Employee under this Agreement, the Company shall pay
the Employee a salary of $140,000 per year during the
term of this Agreement, payable in monthly
installments on or before the last day of each month
during the full term hereof, or in such other
convenient periodic payments as the Company and the
Employee may mutually agree. The Company will review
salary on an annual basis consistent with usual
Company practice. The Employee will be entitled to
participate in any Stock Option or Bonus Plans
offered by the Company.
Section 2.3: Other Benefits. During the Employment Term the
Company shall provide Employees with the same
insurance and other benefits that the Company makes
available to other employees in accordance with the
Company's policies as they exist from time to time.
Section 2.4: Vacation and Sick Pay. The Employee shall be
entitled to an annual vacation of fifteen (15)
business days with full pay. Such vacation shall be
taken at a time selected by the Employee. In
addition, the Employee shall be entitled to ten (10)
business days per year as sick leave or personal
business days with full pay.
Section 2.5: Holidays. The Employee shall be entitled to a
holiday with full pay on New Year's Day, Memorial
Day, Independence Day, Labor Day,
Thanksgiving Day, Christmas Day, and such other days
as the Companies shall from time to time determine.
Section 2.6: Business Expenses. The Employee is authorized to
incur reasonable and necessary business expenses in
the performance of the Employee's duties under this
Agreement, including expenditures for travel and
entertainment. The Company will reimburse the
Employee from time to time for all such business
expenses.
Section 2.7: Automobile Allowance. The Employee shall be entitled
to an automobile allowance consistent with usual
Company practice.
ARTICLE III
Section 3.1: Duties. The Employee shall carry out those duties
normally assigned to the Vice President and Chief
Financial Officer of similar corporations.
Section 3.2: Disclosure of Information. The Employee recognizes
and acknowledges that his position with the Company
is one of the highest trust and confidence by reason
of his access to confidential and proprietary
business information of the Company. The Employee
will not, during his employment and for a period of
six (6) months after the termination of his
employment hereunder, unless required by law or
regulation, disclosure any information obtained from
the Company that is not otherwise publicly available,
or any person or entity doing business with the
Company which information is given and disclosed t
him during the course of employment with the Company,
to any person, firm, corporation, association or
other entity for any reason or purpose whatsoever
without the express approval or direction of the
Board of Directors of the Company.
ARTICLE IV
Section 4.2: Resignation of the Employee. In the event of the
termination of this Agreement prior to the completion
of the term of employment specified above by the
voluntary resignation of the Employee, the Employee
shall be entitled to:
(a) His base salary earned prior to the date of termination as
provided for in Section 2.2 of this Agreement computed pro
rata up to and including the date of termination or
resignation;
(b) Accrued but unused vacation, sick leave, and personal business
days;
(c) Reimbursement for reasonable and necessary business expenses
incurred before resignation; and
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(d) All amounts to which the Employee is entitled under the
Companies' Profit Sharing Plan.
Section 4.2: Termination by Reason of Death or Disability.
(a) Upon the death of the Employee, the Employment Term shall
automatically terminate on the last day of the month in which
the death of Employee occurs.
(b) If Employee is determined to be Disabled (as hereinafter
defined) then the Companies may, upon thirty (30) days written
notice to Employee, terminate Employee's employment hereunder,
but in addition to the benefits described in Section 4.2(c)
below, Employee shall continue to receive full salary for six
months or until he is eligible to receive any benefits to
which he may be entitled under the terms of the long-term
disability coverage provided by he Company. For the purposes
of this Agreement, the "Disability" of Employee shall mean any
incapacity or inability to perform Employee's normal or
assigned duties to the Company, in either case due to injury
or illness (physical or mental), for a period of at least
forty-five (45) days out of any calendar year.
(c) Upon termination of employment pursuant to Section 4.2(a) or
(b) of the Employee or his estate shall be entitled to receive:
(i) The base salary provided by Section 2.2 that the Employee was
then receiving through the date of termination as provided
above;
(ii) All bonuses earned through the date of termination, paid in
accordance with the terms of the bonus plan pursuant to which
the bonus was earned;
(iii) Accrued but unused vacation and sick leave pay;
(iv) Reimbursement for reasonable and necessary business expenses
previously incurred.
(v) All amounts to which the Employee is entitled under any Profit
Sharing Plan of the Company.
Section 4.3: Termination by the Company for Cause. Subject to
any opportunity to cure on the part of Employee, the
Company may for cause (as hereinafter defined)
terminate Employee's employment hereunder upon
written notice specifying the particulars of the
Cause. "Cause" shall mean:
(a) Any international material breach by the Employee of any of
the terms and conditions of this Agreement;
(b) A breach of Employee's fiduciary duties to the Company;
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(c) Misappropriation of any material amount of the Company's
assets; or
(d) Employee's habitual negligence or nonfeasance in the
performance of his duties hereunder; and
With respect to any of the events specified in (a), (b), (c) and (d)
above, the Company will provide Employee with written notice thereof and a ten
(10) working day opportunity to cure such matter to the satisfaction of the
Company.
In the event of the termination of this Agreement for any of the
reasons set forth in this Section 4.3 the Employee shall be entitled to receive:
(a) His base salary earned prior to the date of termination as
provided in Section 2.2 of this Agreement computed pro rata up
to and including the date of termination;
(b) All amounts to which the Employee is entitled under the
Company's Profit Sharing Plan; and
(c) Any bonuses earned through the date of termination, paid in
accordance with the terms of the bonus plan pursuant to which
any bonus may have been earned. The Employee's share of any
annual cash bonus pool shall be computed pro rata based on the
actual number of days during the year the Employee was
employed by the Company; provided, however, nothing herein
shall be construed to require the Company to calculate or pay
any bonus prior to the regularly scheduled time for making
such calculation or payment; and
(d) Any accrued but unused vacation and sick leave pay.
Section 4.4: Termination on Grounds Other Than Cause,
Disability or Death. Should the Employee's employment
hereunder be terminated by the Company on grounds
other than for Cause, disability, resignation or
death, the Employee shall be entitled to receive, as
the Employee's sole remedy and as liquidated damages:
(a) The greater of (i) the base salary that the Employee was then
receiving for the remainder of the term of employment set
forth in Section 2.2 above, or (ii) $200,000, paid in a lump
sum; and
(b) Any bonuses earned through the date of termination, paid in
accordance with the terms of the bonus plan pursuant to which
any bonus may have been earned. The Employee's share of any
annual cash bonus pool shall be computed pro rata based on the
actual number of days during the year the Employee was
employed by the Companies; provided, however, nothing herein
shall be construed to require the Companies to calculate or
pay any bonus prior to the regularly scheduled time for making
such calculation or payment.
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(c) Accrued but unused vacation and sick leave pay;
(d) Reimbursement for reasonable and necessary business expenses
previously incurred;
(e) All amounts to which the Employee is entitled under any Profit
Sharing Plan of the Company;
(f) Monthly payments for one year equal to the monthly premium
required by the Employee to maintain his life and health
insurance benefits pursuant to the Consolidated Omnibus Budget
Reconciliation Act of 1985 ("COBRA") under the Company's group
insurance plans.
ARTICLE V
Section 5.1: Covenant Not to Compete. During the period of
this Agreement and expiring one (1) year after the
end of Employee's employment by the Company, Employee
shall not, without the approval of the Board of
Directors, directly or indirectly compete with
Company in the manufacture, sale or distribution of
frozen foods or in any other businesses in which the
Company may then be active.
ARTICLE VI
Section 6.1: Notices. Any notice required or permitted to be
given under this Agreement shall be in writing and
shall be deemed to have been duly given on the date
of service if served personally on the party to whom
notice is to be given, or on the third (3) day after
mailing if mailed to the party to whom notice is to
be given properly addressed, certified mail, return
receipt requested, postage prepaid, addressed as
follows:
Section 6.1.1: In the case of Employee, to his residence as shown on
the Company's records; and
Section 6.1.2: In the case of the Company, to its principal offices.
Section 6.2: Waiver of Breach. The waiver by the Company or
the Employee of a breach of any provision of this
Agreement by the other party hereto shall not operate
or be construed as a waiver of any subsequent breach
of the same or any other provision hereof by the same
party.
Section 6.3: Assignment. Neither the Company nor the Employee may
assign rights or obligations under this Agreement.
Section 6.4: Benefit. This Agreement shall be binding upon and
inure to the benefit of the legal representatives,
successors and assigns of the Company and the
Employee.
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Section 6.5: Amendments. No charge, alteration or amendment to
this Agreement shall be valid or binding upon the
parties hereto unless made in writing and signed by
both parties hereto.
Section 6.6: Construction. This Agreement constitutes the entire
understanding between the parties and the parties
here by declare that there are no oral or other
agreements or understandings between them. This
Agreement supersedes all previous agreements between
the parties.
Section 6.7: Multiple Counterparts. This Agreement is being
executed in multiple identical counterparts, each of
which shall be deemed an original, and all of which
taken together shall constitute but one and the same
instrument; but in making proof of this Agreement, it
shall not be necessary to produce or account for more
than one counterpart executed by the party sought to
be charged with performance hereunder.
Section 6.8: Jurisdiction. The parties agree that the courts of
the State of California, and any courts whose
jurisdiction is derivative on the jurisdiction of the
courts of the State of California, shall have
personal jurisdiction over all parties to this
Agreement.
Section 6.9: Attorneys' Fees. If any civil action, whether at law
or in equity, is necessary to enforce or interpret
any of the terms of this Agreement, the prevailing
party shall be entitled to reasonable attorneys'
fees, court costs and other reasonable expense of
litigation, in addition to other relief to which such
party may be entitled.
Section 6.10: Headings and Pronouns. The subject headings of the
sections of this Agreement are included for purposes
of convenience only, and shall not affect the
construction or interpretation of any of its
provisions. All pronouns and any variations thereof
shall be deemed to refer to the masculine, feminine,
neuter, singular or plural as the identity of the
entities or persons referred to may require.
IN WITNESS HEREOF, this Agreement has been executed by the Employee and the duly
authorized officer of the Company on the day and year first above written
effective on the date hereinabove set forth.
/s/ Xxxxxx Xxxxxxx
Employee: _______________________ Company:
Overhill Farms, Inc.
/s/ Xxxxx Xxxxx
By: ________________________________
Xxxxx Xxxxx
President
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