EMPLOYEE BENEFITS AGREEMENT
THIS EMPLOYEE BENEFITS AGREEMENT (this "Agreement") is entered
into by and between Epitope, Inc., an Oregon corporation ("Epitope"), and
Agritope, Inc., a Delaware corporation ("Agritope"), as of December 1, 1997.
RECITALS
A. The board of directors of Epitope has determined that it is
in the best interests of Epitope and its shareholders to separate the businesses
of Epitope and Agritope.
B. In furtherance of the plan to separate the businesses,
Epitope and Agritope have entered into that certain Separation Agreement dated
December 1, 1997 (the "Separation Agreement"), pursuant to which Epitope will
make a dividend distribution to its shareholders (the "Distribution") of all the
issued and outstanding shares of Agritope common stock, par value $.01 per
share, including certain preferred stock purchase rights attached thereto, held
by Epitope, on the terms and conditions contained therein.
C. In connection with the Distribution, Epitope and Agritope
desire to provide for the allocation between them of assets, liabilities and
responsibilities with respect to certain employee compensation and benefit plans
and programs following the Distribution.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements contained herein, Epitope and Agritope agree as
follows:
ARTICLE 1
DEFINITIONS
Capitalized terms shall have the meanings given below or
elsewhere in this Agreement, or as set forth in the Separation Agreement.
401(k) Retirement Plan: A defined contribution plan maintained
pursuant to Section 401(k) or 401(a) of the Code for Employees and their
beneficiaries. The following are specific 401(k) Retirement Plans:
(i) Agritope 401(k) Plan: The Agritope, Inc. 401(k)
Profit Sharing Plan to be adopted by Agritope prior
to the Distribution Date pursuant to Section 5.1(a)
of this Agreement.
(ii) Epitope 401(k) Plan: The Epitope, Inc. 401(k) Profit
Sharing Plan, in effect as of the date hereof.
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Additional Insurance Plans: Insurance plans providing
insurance benefits other than Medical/Dental Plan benefits to Employees,
including Life Insurance and Accidental Death and Dismemberment Insurance.
Agritope Board: The board of directors of Agritope.
Agritope Option Plan: The Agritope, Inc. 1997 Stock Award Plan
to be adopted pursuant to Section 3.4 of this Agreement.
Agritope Stock Distribution Value: See definition in Section
3.1(b).
Agritope Stock Plans: The Agritope Option Plan and the
Agritope Purchase Plan. Each Agritope Stock Plan will contain substantially the
same material provisions as the corresponding Epitope Plan.
Distribution Date: The effective date of the Distribution, as
determined by the Epitope board of directors.
Distribution Ratio: The number (which may be or include a
fraction) of shares of Agritope Stock to be issued in the Distribution to
Epitope shareholders for each share of Epitope Stock as determined by the
Epitope Board.
Employee: An individual who, on the Distribution Date, is an
employee of either Epitope or Agritope or any of its subsidiaries. There will be
two categories of Employees after the Distribution:
Agritope Employee: Any individual who is an employee
of Agritope or any of its subsidiaries immediately after the
Distribution.
Epitope Employee: Any individual who is an employee
of Epitope immediately after the Distribution.
Epitope Option Plans: The Epitope, Inc. Incentive Stock Option
Plan and the Epitope, Inc. 1991 Stock Award Plan.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended, or any successor legislation.
Existing Agritope Option Plan: The Agritope, Inc. 1992 Stock
Award Plan.
Existing Epitope Option: Each unexercised option to purchase
Epitope Stock outstanding as of the close of business on the day before the
Distribution Date, issued pursuant to an Epitope Option Plan or the Existing
Agritope Option Plan.
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Medical/Dental Plan: A plan providing health benefits to
Employees and their dependents, including:
(i) Agritope Medical/Dental Plans: The Medical/Dental Plans to
be established by Agritope in accordance with Section 5.2 hereof and
(ii) Epitope Medical/Dental Plans: The Epitope Medical/Dental
Plans in effect as of the date hereof and continued by Epitope after
the Distribution Date.
Plan: Any plan, policy, arrangement, contract or agreement
providing compensation or benefits for any group of Employees or for any
individual Employee or the dependents or beneficiaries of any such Employee,
including without limitation any employee welfare and employee pension benefit
plans (as defined in ERISA) and any employee option plans. The term "Plan" as
used in this Agreement does not include any contract, agreement or understanding
entered into by Epitope or Agritope relating to settlement of actual or
potential employee-related litigation claims.
Purchase Plan: A stock-based Plan meeting the requirements of
Section 423 of the Code. The following are specific Purchase Plans:
(i) Agritope Purchase Plan: The Agritope, Inc. 1997
Employee Stock Purchase Plan to be adopted by Agritope prior
to the Distribution Date pursuant to Section 4.2.
(ii) Epitope Purchase Plan: The Epitope, Inc. 1993
Employee Stock Purchase Plan, as amended, in effect as of the
date hereof.
Qualified Beneficiary: An individual (or dependent thereof)
who either (1) experiences a "qualifying event" (as that term is defined in Code
Section 4980B(f)(3) and ERISA Section 603) while a participant in any
Medical/Dental Plan, or (2) becomes a "qualified beneficiary" (as that term is
defined in Code Section 4980B(g)(1) and ERISA Section 607(3)) under any
Medical/Dental Plan.
Service Time: The period taken into account under any Plan for
purposes of determining length of service or plan participation to satisfy
eligibility, vesting, benefit accrual and similar requirements under such Plan.
Welfare Plan: Any Plan that provides medical, health,
disability, accident, life insurance, death, dental or any other welfare
benefit, including, without limitation, any post-employment benefit.
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ARTICLE 2
EMPLOYMENT AND CREDITS
2.1 Allocation of Responsibilities on Distribution Date. On the
Distribution Date, except as otherwise agreed between the parties, Agritope
shall retain or assume, as the case may be, sole responsibility as employer for
Agritope Employees, and shall cause any Agritope Employee that is then a party
to any employment, change in control or other employment-related agreement with
Epitope to terminate such agreement effective as of the Distribution Date
(except confidentiality, indemnification, and similar agreements relating
primarily to past services to Epitope). Except as otherwise provided in this
Agreement, the fact that Agritope assumes or retains responsibility as employer
of Agritope Employees as of the Distribution Date shall not, of itself, cause
such employee to be deemed terminated under any Plan maintained by Epitope or
Agritope.
2.2 Service Time. For purposes of determining Service Time under any
Welfare Plan, Agritope shall credit each Agritope Employee with such Employee's
Service Time and original hire date as may be reflected in Epitope's employment
records as of the Distribution Date. Such Service Time and hire date shall
continue to be maintained for as long as the Employee's employment with Agritope
does not terminate. Agritope shall be free to make such determinations relating
to Service Time under any Agritope Stock Plans as Agritope, in its sole
discretion, deems appropriate. Subject to the provisions of ERISA, Agritope may,
in its sole discretion, make such decisions as it deems appropriate with respect
to determining Service Time for any Agritope Employee whose employment with
Agritope is terminated following the Distribution Date but who is subsequently
reemployed by Agritope.
ARTICLE 3
STOCK OPTIONS
3.1 Amendment of Epitope Option Plans. Prior to the Distribution Date,
Epitope shall take all action necessary and appropriate to amend the Epitope
Option Plans and, to the extent necessary and permissible without the consent of
option holders, outstanding options issued under the plans to be consistent with
the terms of this Section 3.1.
(a) Effect of Employment by Agritope. For purposes of
determining the period during which Existing Epitope Options remain
exercisable, employment by Agritope or any of its majority owned
subsidiaries following the Distribution Date shall be deemed employment
by Epitope, notwithstanding the fact that Agritope will no longer be a
subsidiary of Epitope after the Distribution Date. For continued or
future vesting and all other purposes relating to Existing Epitope
Options, employment by Agritope or any of its majority owned
subsidiaries after the Distribution Date shall not be deemed employment
by Epitope. Accordingly, any affected holder of an Existing Epitope
Options granted under Epitope Option Plans will be treated as a
terminated employee and options will continue to vest according to the
schedule provided in the applicable award agreement.
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(b) Adjustment to Exercise Price of Existing Epitope Options.
The per share exercise price of each Existing Epitope Option issued
under the Epitope Option Plans shall be reduced ten days after the
Distribution Date by subtracting the Agritope Stock Distribution Value
(as defined below) from the stated exercise price. "Agritope Stock
Distribution Value" is an amount intended to reflect the value of the
Agritope Stock distributed on each share of Epitope Stock, and is equal
to the product of (a) the average of the reported closing prices of
Agritope Stock on The Nasdaq SmallCap Market during the five
consecutive trading days beginning on the Distribution Date, multiplied
by (b) the Distribution Ratio.
3.2 Amendment of Existing Agritope Option Plan. Prior to the
Distribution Date, Agritope shall take all action necessary and appropriate to
amend the Existing Agritope Option Plan and/or outstanding Award Agreements (as
defined in the Existing Agritope Option Plan) entered into in connection with
the Plan to be consistent with the terms of this Section 3.2.
(a) Issuance of Epitope Stock Upon Exercise. Epitope Stock
shall be issued upon exercise of Existing Epitope Options granted
pursuant to the Existing Agritope Option Plan, notwithstanding the fact
that the options are denominated in shares of Agritope Stock. The
existing agreement between Epitope and Agritope providing for issuance
of Epitope Stock upon exercise of such options will be amended to
remain in effect following the Distribution.
(b) Effect of the Distribution. If the holder of Existing
Epitope Options granted under the Existing Agritope Option Plan is an
Agritope Employee after the Distribution, such holder shall for
continued or future vesting purposes be deemed terminated on the
Distribution Date but, for purposes of determining the period options
remain exercisable, such holder shall not be deemed terminated until
employment by Agritope is terminated. Accordingly, Existing Epitope
Options granted under the Existing Agritope Option Plan shall continue
to vest following the Distribution Date according to the vesting
schedule applicable to terminated employees set forth in the applicable
Award Agreement. If such option holder is an Epitope Employee, such
options shall continue to vest and be exercisable as set forth in the
Existing Agritope Option Plan or outstanding Award Agreements.
(c) Adjustment to Exercise Price of Options Issued Under
Existing Agritope Plan. The per share exercise price of each Existing
Epitope Option issued under the Existing Agritope Option Plan (which
price is stated in terms of Agritope Stock) shall be reduced ten days
after the Distribution Date by subtracting from the stated exercise
price the product of (a) the Agritope Stock Distribution Value,
multiplied by (b) the number (which will be a fraction) of shares of
Epitope Stock to be exchanged for each share of Agritope Stock for
which the option is exercised.
(d) No Further Option Grants. Agritope shall not grant any
additional options under the Existing Agritope Option Plan.
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3.3 Effect of the Distribution on Change in Control Provisions. Nothing
in this Agreement or in any amendment to the Epitope Option Plans, the Existing
Agritope Option Plan or to any award agreement issued under any Plan shall be
interpreted to modify the change in control provisions in any Existing Epitope
Options. Existing Epitope Options shall continue to become immediately and fully
vested and exercisable as to all shares covered by such option upon a Change in
Control Date (as defined in the terms and conditions applicable to Existing
Epitope Options).
3.4 Adoption of Agritope Option Plan. Prior to the Distribution Date,
Agritope shall take, or cause to be taken, all action necessary and appropriate
(i) to prepare and ratify the adoption of the Agritope Option Plan, and (ii) to
present the Agritope Option Plan to Epitope, as the sole shareholder of
Agritope, for approval. Agritope and Epitope shall cooperate in the adoption of
the Agritope Option Plan and the reservation for issuance under the plan of such
shares of Agritope Stock as are deemed necessary and appropriate by the Agritope
Board.
3.5 Communication Regarding Termination Of Employment. Agritope shall
notify Epitope of the termination of employment of any Agritope Employee holding
an Existing Epitope Option within ten days of such termination. Such notice with
respect to termination shall specify the date of termination, whether the
termination was for cause or came as a result of retirement, and such other
information as Epitope shall reasonably request.
ARTICLE 4
STOCK PURCHASE PLANS
4.1 Epitope Purchase Plan. The Epitope Purchase Plan will continue in
full force and effect in accordance with its terms. Participants under the
Epitope Purchase Plan will be eligible to participate in the Distribution only
to the extent that, by operation of the Epitope Purchase Plan or otherwise, they
are shareholders of record on the Record Date; provided, however, that
participants who are entitled to receive shares of Epitope Common Stock under
the Epitope Purchase Plan as of the Record Date but have not yet been
mechanically recorded as shareholders of record on the Record Date will be
treated as shareholders of record for purposes of the Distribution. Employment
by Agritope or any of its majority-owned subsidiaries following the Distribution
Date shall not be deemed employment by Epitope for purposes of the Epitope
Purchase Plan and any Agritope Employee shall be treated as a terminated
employee under the Epitope Purchase Plan. For purposes of the continuing
operation of the Epitope Purchase Plan, Epitope will adjust the Maximum Purchase
Price (as defined in the Epitope Purchase Plan) to account for the effect of the
Distribution by subtracting the Agritope Stock Distribution Value from the
Maximum Purchase Price.
4.2 Adoption of Agritope Purchase Plan. Prior to the Distribution Date,
Agritope shall take, or cause to be taken, all action necessary and appropriate
(i) to ratify the adoption of the Agritope Purchase Plan, and (ii) to present
the Agritope Purchase Plan to Epitope, as the sole shareholder of Agritope, for
approval.
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ARTICLE 5
OTHER BENEFIT PLANS
5.1 401(k) Retirement Plans.
(a) Establishment of Agritope 401(k) Plan. Effective January
1, 1998, Agritope shall establish and thereafter administer the
Agritope 401(k) Plan, in such form as may be approved by the Agritope
Board, which is intended to qualify under Sections 401(a), 501(a) and
401(k) of the Code and to be in compliance with the requirements of
ERISA. The Agritope 401(k) Plan will provide credit for services
rendered to Epitope or any of its subsidiaries prior to the
Distribution Date in determining Service Time.
(b) Continuation of Benefits. Agritope Employees shall
continue to be eligible to participate in the Epitope 401(k) Plan until
such time as the Agritope 401(k) Plan is established and becomes
effective. Effective as of the effective date of the Agritope 401(k)
Plan, which is expected to be January 1, 1998, Agritope will provide
benefits under the Agritope 401(k) Plan to all Agritope Employees who
were participants in, or otherwise entitled to benefits under, the
Epitope 401(k) Plan. All Agritope Employees who wish to participate in
the Agritope 401(k) Plan will be required to enroll in the Agritope
401(k) Plan in accordance with its terms.
(c) Vesting and Distribution of Accounts. Agritope Employees
shall become fully vested (if not already fully vested) in their
Matching Accounts, as defined under the Epitope 401(k) Plan, as of the
Distribution Date. Agritope Employees shall be entitled to distribution
from the Epitope 401(k) Plan of all of their accounts within a
reasonable time after the Distribution Date. The Agritope 401(k) Plan
shall accept a rollover contribution from any Agritope Employee who
elects that their distribution from the Epitope 401(k) Plan be rolled
over to the Agritope 401(k) Plan.
(d) Epitope to Provide Information. Epitope shall provide
Agritope, as soon as practicable after the Distribution Date, with a
list of Agritope Employees who, to the best knowledge of Epitope, were
participants in or otherwise entitled to benefits under the Epitope
401(k) Plan on the Distribution Date, together with a listing of each
participant's Service Time under the Epitope 401(k) Plan and a listing
of each such Agritope Employee's account balance thereunder. Epitope
shall provide Agritope with such additional information in the
possession of Epitope or Epitope's agent as may be reasonably requested
by Agritope related to the effective administration of the Agritope
401(k) Plan.
(e) Cooperation. Agritope and Epitope shall, in connection
with the plan-to-plan transfer described in 5.1(c), use their best
efforts to cooperate in the plan-to-plan transfer of funds and in
making any and all appropriate filings required
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by the Commission or the Internal Revenue Service, or required under
the Code, ERISA, or any applicable securities laws and the regulations
thereunder.
(f) Effect of the Distribution. The Distribution and
subsequent transfer of account balances shall not be treated as a
termination or partial termination of the Epitope 401(k) Plan or of
Agritope Employees under the Epitope 401(k) Plan.
5.2 Medical/Dental Plan Liability and Coverage.
(a) Continuation of Coverages After the Distribution. Epitope
shall continue to provide coverage to Agritope Employees under Epitope
Medical/Dental Plans after the Distribution Date until such time as new
medical/dental plans are established by Agritope. If during the period
from the Distribution Date until the establishment of Agritope Medical
and Dental Plans, Epitope, in its reasonable discretion, determines
that continued coverage of Agritope Employees under Epitope
Medical/Dental Plans will have an adverse effect on the business plans
or strategies of Epitope, Epitope may, upon 90 days written notice to
Agritope, terminate such coverage. After the Distribution Date,
Agritope shall be responsible for all costs under the Epitope
Medical/Dental Plans attributable to Agritope Employees, as shall be
determined by Epitope in its reasonable discretion.
(b) Agritope Medical/Dental Plans. Unless the parties
otherwise agree, Agritope shall establish Agritope Medical/Dental Plans
to provide coverages to Agritope Employees substantially similar to
those available under the corresponding Epitope Medical/Dental Plans on
or before January 1, 1999. In connection with the establishment of
Agritope Medical/Dental Plans, Agritope Employees and their eligible
dependents and beneficiaries shall have no preexisting condition
limitation imposed other than that which is or was imposed under the
plan or plans in which they were enrolled before the date Agritope
Medical/Dental Plans are established and become effective (the "Cutoff
Date"), and will be credited with any expenses incurred toward
deductibles, out-of-pocket expenses, maximum benefit payments, and any
benefit usage toward plan limits that would have been applicable under
the plan or plans in which they were enrolled before the Cutoff Date.
(c) Responsibility for Coverages after the Cutoff Date.
Immediately after the Cutoff Date, Agritope shall provide coverage to
Agritope Employees under Agritope Medical/Dental Plans. Epitope
Medical/Dental Plans shall continue to be responsible for claims that
arise prior to the Cutoff Date subject to the cost reimbursement
provisions set forth in Section 5.2(a).
(d) COBRA. Epitope shall be responsible for complying with the
requirement of Code Section 4980B and Part 6 of Title I of ERISA
("COBRA Requirements") with respect to any Employee in its group health
plan and their "qualified beneficiaries" whose "qualifying event" (as
such terms are defined in Code Section 4980B) occurs prior to the
Distribution Date. After the Distribution Date,
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Agritope shall be responsible for compliance with COBRA Requirements
with respect to Agritope Employees whose "qualifying event" occurs on
or after the Distribution Date.
(e) No Qualifying Event. The Distribution described in the
Separation Agreement shall not, by itself, create a "qualifying event"
(as described in Code Section 4980B(f)(3) and ERISA Section 603).
(f) Refunds. In the event that subsequent to the Cutoff Date,
refunds are received from carriers providing medical or dental
insurance, such refunds will belong to Epitope, to the extent
attributable to Epitope Employees. Agritope shall receive such refunds
to the extent attributable to Agritope Employees, as shall be
determined by Epitope in its reasonable discretion.
5.3 Life Insurance/Accidental Death and Dismemberment Coverages.
(a) Continuation of Coverages After the Distribution. Epitope
shall continue to provide coverage to Agritope Employees under
Epitope's Additional Insurance Plans after the Distribution Date until
such time as Additional Insurance Plans are established by Agritope. If
during the period from the Distribution Date until the establishment by
Agritope of Additional Insurance Plans, Epitope, in its reasonable
discretion, determines that continued coverage of Agritope Employees
under Epitope's Additional Insurance Plans will have an adverse effect
on the business plans or strategies of Epitope, Epitope may, upon 90
days' written notice to Agritope, terminate such coverage. After the
Distribution Date, Agritope shall be responsible for all costs under
Epitope's Additional Insurance Plans attributable to Agritope
Employees, as shall be determined by Epitope in its reasonable
discretion.
(b) Agritope's Additional Insurance Plans. Unless the parties
otherwise agree, Agritope shall establish Additional Insurance Plans to
provide coverages to Agritope Employees substantially similar to those
available under Epitope's corresponding Additional Insurance Plans on
or before January 1, 1999.
(c) Responsibility for Coverages. Immediately after Agritope's
Additional Insurance Plans become effective, Agritope shall be solely
responsible for providing all coverages relating to Additional
Insurance Plans to Agritope Employees.
5.4 Vacation And Sick Pay Liabilities. Effective on the Distribution
Date, Epitope shall retain, as to Epitope Employees, and Agritope shall assume
or retain, as the case may be, as to Agritope Employees, all liabilities
(whether vested or unvested, and whether funded or unfunded) for vacation and
sick leave accrued as of the Distribution Date. Agritope shall be solely
responsible for the payment of such vacation or sick leave to Agritope Employees
after the Distribution Date. Each of Epitope and Agritope shall provide to its
own Employees on the Distribution Date the same vested and unvested balances of
vacation and sick leave as credited to such Employee on the Epitope payroll
systems as of the Distribution
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Date. Nothing in this Agreement shall be construed to limit the right of either
Epitope or Agritope to change its vacation or sick leave policies as it deems
appropriate.
5.5 Flexible Spending Accounts. Effective as of the Distribution Date,
Agritope shall establish Flexible Spending Account Plans that are substantially
equivalent to those currently provided by Epitope. Spending account balances for
Agritope Employees will not be transferred by Epitope to the new plans
established by Agritope. Agritope Employees will have 90 days after the
Distribution Date to make claims for payment from their existing spending
account balances.
ARTICLE 6
RELATED MATTERS
6.1 Notice of Costs. Epitope and Agritope acknowledge that Epitope and
Agritope may have incurred or may incur costs and expenses, including, but not
limited to, contributions to Plans and the payment of insurance premiums arising
from or related to any of the Plans that are, as set forth in this Agreement,
the responsibility of the other party hereto. Accordingly, Epitope and Agritope
shall (i) give notice to the other party of the costs and expenses incurred or
the costs and expenses to be incurred and (ii) demand that the other party, if
it has the obligation to pay, pay or reimburse the cost and expense.
6.2 Payroll Reporting And Withholding.
(a) Agritope and Epitope hereby adopt the "standard procedure"
for preparing and filing IRS Forms W-2 (Wage and Tax Statements) and
W-3 (Transmittal of Income and Tax Statements), as described in Section
4 of Revenue Procedure 96-60 ("Rev. Proc. 96-60"). Under this procedure
Epitope must perform all reporting duties for the wages and other
compensation it has paid to Employees prior to the Distribution Date,
including the furnishing and filing of Forms W-2 and W-3. Agritope will
be responsible for all reporting duties for the wages and other
compensation it pays to Agritope Employees.
(b) Epitope will keep on file all Forms W-4 (Employee's
Withholding Allowance Certificate) and W-5 (Earned Income Credit
Advance Payment Certificate) provided by Agritope Employees. Agritope
Employees must provide Agritope with new Forms W-4 and W-5 for the year
in which the Distribution occurs.
(c) With respect to Agritope Employees with garnishments, tax
levies, child support orders, qualified medical child support orders,
and wage assignments in effect with Epitope on the Distribution Date,
Agritope shall be responsible for honoring such payroll deduction
authorizations or court or governmental orders applicable to Agritope
Plans, and will continue to make payroll deductions and payments to any
authorized payee, as specified by the court or governmental order that
was filed with Epitope. Epitope shall provide Agritope with full
information about any such matters before the Distribution Date.
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(d) Unless otherwise prohibited by law or provided by this
Agreement or another agreement entered into in connection with the
Distribution, or by a Plan document, with respect to Agritope Employees
with authorizations for payroll deductions in effect with Epitope on
the Distribution Date, Agritope as the successor employer will honor
such payroll deduction authorizations relating to each Agritope
Employee, and shall not require that such Agritope Employee submit a
new authorization to the extent that the type of deduction by Agritope
does not differ from that made by Epitope. Any such payroll deduction
in favor of Epitope shall continue to be withheld by Agritope for
Epitope's benefit.
6.3 Access to Records and Confidentiality. Epitope shall retain all
employment records, personnel files, and other information relating to Epitope
Employees and payroll records relating to Agritope Employees. Agritope shall
take possession of all personnel and employment records, except payroll records,
relating to Agritope Employees after the Distribution Date. Agritope and Epitope
will make available to the other party such records, documents, and other
information relating to employment matters involving Agritope Employees and
other matters covered in this Agreement as may be reasonably requested. The
parties shall cooperate in providing any information necessary for the
resolution of any dispute that may arise between Epitope or Agritope and any
third party arising out of subject matter covered by this Agreement after the
Distribution Date. Epitope and Agritope will each, upon adequate notice and
reasonable request, make its employees and facilities available to the other
party and shall permit the other party to copy at its own expense records
relating to Agritope Employees as necessary and appropriate. Except as required
by law or with the prior written consent of Epitope and any affected Employee,
all records, documents, and other information provided to Agritope by Epitope
related to Agritope Employees and other matters covered in this Agreement shall
be kept confidential by Agritope and its representatives and shall not be
disclosed to any other person or entity.
ARTICLE 7
EMPLOYMENT MATTERS
7.1 Separate Employers. After the Distribution Date, Epitope and
Agritope will be separate and independent employers.
7.2 Employment Policies And Practices. Epitope and Agritope may adopt
such employment policies, compensation practices, retirement plans, welfare
benefit plans, and other employee benefit plans or policies of any kind or
description, as each may determine, in its sole discretion, are necessary and
appropriate, in addition to those required under this Agreement. Except as
otherwise expressly provided herein, no provision of this Agreement shall be
construed as a limitation on the right of Epitope or Agritope to amend or
terminate any policies, practices, or Plan.
7.3 Funding Of Plans. Any claims by or on behalf of Employees or any
federal, state or local government agency for alleged underfunding of, or
failure to make payments to, health and welfare funds based on acts or omissions
occurring on or before the
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Distribution Date or arising from or in connection with the Distribution, will
be the sole responsibility of each party as to its own employees (i.e., Epitope
with respect to Epitope Employees and Agritope with respect to Agritope
Employees).
7.4 Employment Tax Rates. Agritope shall comply with ORS Chapter 657 in
determining whether to assume the state unemployment tax experience of Epitope
for purposes of establishing its own unemployment tax experience rates.
ARTICLE 8
MISCELLANEOUS
8.1 Indemnification. Each party to this Agreement shall indemnify,
defend, and hold harmless the other party against losses incurred as a result of
claims relating to matters covered in this Agreement to the extent provided in
the Separation Agreement. In addition, subject to the indemnification procedures
set forth in the Separation Agreement:
(a) Indemnification by Epitope. Epitope shall indemnify,
defend, and hold harmless Agritope and its subsidiaries from and
against any liabilities incurred as a result of claims made against
Agritope by Epitope Employees relating to or arising out of employment
of Epitope Employees by Epitope after the Distribution Date, employee
benefits provided to Epitope Employees after the Distribution Date, or
termination in connection with the Distribution of any Employee who
becomes or remains an Epitope Employee on or after the Distribution
Date; and
(b) Indemnification by Agritope. Agritope shall indemnify,
defend, and hold harmless Epitope and any future subsidiary of Epitope
from and against any liabilities incurred as a result of claims made
against Epitope by Agritope Employees relating to or arising out of
employment of Agritope Employees by Agritope after the Distribution
Date, employee benefits provided to Agritope Employees after the
Distribution Date, or termination in connection with the Distribution
of any Employee who becomes or remains an Agritope Employee on or after
the Distribution Date.
8.2 No Third-Party Beneficiaries. No provision of this Agreement shall
be construed to create a right in any Employee, or dependent or beneficiary of
such Employee, including without limitation any right under a Plan which such
person would not otherwise have under the terms of the Plan itself. This
Agreement is for the benefit of the parties hereto and is not intended to confer
upon any other person except the parties hereto any rights or remedies.
8.3 Attorney-Client Privilege. Consistent with the provisions of
Section 6.6 of the Separation Agreement, provisions requiring either party to
this Agreement to cooperate shall not be deemed to be a waiver of the
attorney/client privilege for either party nor shall they require either party
to waive its attorney/client privilege.
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8.4 Dispute Resolution. Any disputes between the parties arising out of
or related to this Agreement shall be resolved or decided as set forth in the
Separation Agreement.
8.5 Relationship of the Parties. Neither party is an agent of the other
party and neither party has any authority to bind the other party, transact any
business in the other party's name or on its behalf, or make any promises or
representations on behalf of the other party unless otherwise agreed to in
writing. Each party will perform all of its respective obligations under this
Agreement as an independent contractor.
8.6 Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes all
prior written or oral agreements between the parties with respect to the subject
matter hereof.
8.7 Governing Law. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the state of Oregon.
8.8 Jurisdiction and Venue. Subject to the arbitration provisions of
the Separation Agreement, each party consents to the personal jurisdiction of
the state and federal courts located in the state of Oregon and hereby waives
any argument that venue in any such forum is not convenient or proper.
8.9 Notices. All notices, requests, demands and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given (i) on the date of service if served personally on the party to whom
notice is given; (ii) on the day of transmission if sent via facsimile
transmission to the facsimile number given below, provided telephonic
confirmation of receipt is obtained promptly after completion of transmission;
(iii) on the business day after delivery to an overnight courier service or the
express mail service maintained by the United States Postal Service, provided
receipt of delivery has been confirmed; or (iv) on the fifth day after mailing,
provided receipt of delivery is confirmed, if mailed to the party to whom notice
is to be given, by registered or certified mail, postage prepaid, properly
addressed and return-receipt requested, to the party as follows:
If to Epitope: Epitope, Inc.
0000 X.X. Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxx 00000
Facsimile No. (000) 000-0000
If to Agritope: Agritope, Inc.
0000 X.X. Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxx 00000
Facsimile No. (000) 000-0000
Any party may change its address and facsimile number by giving the other party
written notice of its new address and facsimile number in the manner set forth
above.
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8.10 Modification of Agreement. No modification, amendment or waiver of
any provision of this Agreement shall be effective unless the same shall be in
writing and signed by each of the parties hereto and then such modification,
amendment or waiver shall be effective only in the specific instance and for the
purpose for which given.
8.11 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit 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 either party without the prior
written consent of the other party, and such consent shall not be unreasonably
withheld.
8.12 Titles and Headings. Titles and headings included are for
convenience and are not intended to constitute a part of or to affect the
meaning or interpretation of this Agreement.
8.13 Severability. In case any one or more of the provisions contained
in this Agreement should be invalid, illegal or unenforceable, the
enforceability of the remaining provisions hereof shall not in any way be
affected or impaired thereby.
8.14 No Waiver. Neither the failure nor any delay on the part of any
party hereto to exercise any right under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right preclude
any other or further exercise of the same or any other right, nor shall any
waiver of any right with respect to any occurrence be construed as a waiver of
such right with respect to any other occurrence.
8.15 Survival. All covenants and agreements of the parties contained in
this Agreement will survive for five years following the Distribution Date.
8.16 Counterparts. This Agreement may be executed in counterparts, all
of which shall be considered one and the same agreement, and shall become a
binding agreement when a counterpart has been signed by each party and delivered
to the other party.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered as of the date first written above.
EPITOPE, INC.
By: /s/ Xxxx X. Xxxxxx
Its: President and CEO
AGRITOPE, INC.
By: /s/ Xxxxxx X. Xxxxx
Its: Chairman, Pres. and CEO
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