Exhibit 10.0
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement"), dated as of February 1, 1998, is
by and between CropKing, Incorporated, a Delaware corporation ("Company") and
Xxxxxx X. Xxxxxxxxxxx ("Employee").
WHEREAS, the Employee is currently serving as Chairman of the Board,
President and Chief Executive Officer of the Company;
WHEREAS, the parties desire to enter into this Agreement setting forth
the terms and conditions for the employment relationship of the Employee with
the Company; and
WHEREAS, the Board of Directors of the Company ("Board") has approved and
authorized the entry into this Agreement with the Employee;
NOW, THEREFORE, it is agreed as follows:
1. Employment. From the date hereof through the term of this Agreement
the Employee is employed as Chairman of the Board, President and Chief
Executive Officer of the Company and of any subsidiary or other affiliate
that it may acquire. The Employee shall render executive, policy and other
management services to the Company and subsidiaries/affiliates of the type
customarily performed by persons serving in similar executive officer
capacities. The Employee shall devote substantially all of his working time
and his best efforts to the Company and his position, which shall include
such duties as the Board may from time to time reasonably direct that are
reasonably consistent with the Employee's education, experience and
background. During the term of this Agreement, there shall be no material
increase or decrease in the duties and responsibilities of the Employee
otherwise than as provided herein, unless the parties otherwise agree in
writing.
2. Compensation.
(a) Salary. The Company agrees to pay the Employee from the date
hereof at an annual rate equal to $175,000, with such subsequent increases in
salary during the term of this Agreement as may be determined by the
Compensation Committee of the Board; provided, however, that during the first
three years following the effective date of the registration statement with
respect to the initial public offering of the Company's stock, the Employee's
salary hereunder shall not exceed $250,000 per annum without the approval of
the Compensation Committee. In determining salary increases, the
Compensation Committee may compensate the Employee for increases in the cost
of living and may also provide for performance or merit increases. The salary
of the Employee shall not be decreased at any time during the term of this
Agreement from the amount then in effect, unless the Employee otherwise
agrees in writing. Participation in deferred compensation, bonus,
discretionary
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payable to the Employee under this Section 2(a). The salary under this
Section 2(a) shall be payable to the Employee not less frequently than
monthly. The Employee shall not be entitled to receive fees for serving as a
director of the Company or of any subsidiary or affiliate of the company or
for serving as a member of any committee of any such board of directors.
(b) Annual Bonus. In addition to his salary under
Section 2(a) above, the Company shall pay to the Employee an annual bonus
of 50% of his salary under such subsection, subject to financial performance
criteria as established by the Compensation Committee. The annual bonus shall
be payable in January following each calendar year during the term of this
Agreement and shall be prorated for any partial years.
3. Discretionary and Performance Incentive Bonuses. During the term of
this Agreement, the Employee shall be entitled to participate in an equitable
manner with all other executive employees of the Company in such
discretionary bonuses as may be authorized, declared and paid by the
Compensation Committee to its executive employees. The Company will adopt an
incentive bonus plan providing for the payment of annual performance
incentive bonuses to the Employee and other executive officers based upon the
increase in the Company's operating profit or other appropriate performance
objectives. The incentive bonus arrangement will provide the Employee with an
opportunity to earn additional incentive compensation in an amount up to five
percent of the annual increase in the Company's net income before taxes as
reported in the Company's audited annual financial statement (for fiscal year
1995, net income shall be determined on a pro forma basis). No other
compensation provided for in this Agreement shall be deemed a substitute for
the Employee's right to participate in such bonuses.
4. Insurance, Retirement and Employee Benefit Plans, Fringe Benefits:
Business Expenses.
(a) Other Benefits and Prerequisites. The Employee shall be
entitled to participate in any plan of the Company relating to stock options,
restricted stock, employee stock purchase or ownership, pension, thrift,
profit sharing, group life insurance, medical coverage, education or other
retirement or employee benefit plans or arrangements that the Company has
adopted or may adopt for the benefit of its employees or executive officers.
The Employee shall also been titled to participate in, or enjoy the benefit
of, any other fringe benefits or perquisites that are now or may be or become
applicable to the Company's executive employees. The Employee shall also be
provided with the use of a suitable automobile at Company expense and will be
entitled to have access to and use, consistent with the rules and regulations
of such facility, a club membership to be obtained in the name of the
Company. The Employee shall account to the Company for the business use of
such automobile and club.
(b) Business Expenses. During the term of the Employee's employment
by the Company, the Company shall promptly reimburse the Employee for all
reasonable and customary expenses incurred by the Employee in performing
services for the Company, including all expenses of travel and living
expenses while away from home on business or at the request of and in the
service of the Company, provided that such expenses are incurred and
accounted for in accordance with the policies and procedures established by
the Company.
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5. Term. The initial term of employment under this Agreement shall be
from the date of this Agreement until January 31, 2003. This Agreement shall
be automatically renewed for an additional five-year term, unless either
Employee or the Company gives contrary written notice to the other party
hereto not less than 180 days before the scheduled expiration of the term of
this Agreement. Each term and all such renewed terms are collectively
referred to herein as the term of this Agreement.
6. Voluntary Absences: Vacations. The Employee shall be entitled,
without loss of pay, to be absent voluntarily for reasonable periods of time
from the performance of the duties and responsibilities under this Agreement.
All such voluntary absences shall count as paid vacation time, unless the
Board otherwise approves. The Employee shall be entitled to an annual paid
vacation of at least six weeks per year or such longer period as the Board
may approve. The timing of paid vacations shall be scheduled in a reasonable
manner by the Employee.
7. Termination of Employment. The Employee's employment may be
terminated without any breach of this Agreement only under the following
circumstances:
(a) Death. The Employee's Employment shall terminate upon his death.
(b) Disability. The Company may terminate the Employee's employment
because of disability. For this purpose, "Disability" shall mean the
inability of the Employee to perform his duties under this Agreement because
of physical or mental illness or incapacity for a continuous period of six
months during which the Employee shall have been absent from his duties under
this Agreement on a substantially full-time basis.
(c) Cause. The Company may terminate the Employee's employment for
Cause. For purposes of this Agreement, the Company shall have "Cause" to
terminate the Employee's employment only in the event of (1) the willful and
continued failure by the Employee to substantially perform his duties
hereunder (other than any such failure resulting from the Employee's
inability to perform such duties as a result of physical or mental illness or
incapacity or any such actual or anticipated failure after the delivery of a
Notice of Termination, as defined in Section 7(c), by the Employee for Good
Reason, as defined in Section 7(d)(2), after delivery to the Employee of a
written demand for substantial performance that specifically identifies the
manner in which the Company believes that the Employee has not substantially
performed his duties and a reasonable opportunity to cure; (2) willful
misconduct by the Employee that causes substantial and material injury to the
business and operations of the Company, the continuation of which, in the
reasonable judgment of the Board, will continue to substantially and
materially injure the business and operations of the Company in the future;
or (3) conviction of the Employee of a felony. No act or failure to act shall
be considered "willful" for this purpose unless done, or omitted to be done,
by the Employee other than in good faith and other than with a reasonable
belief that his action or omission was in the best interests of the Company.
The Employee shall not be deemed to have been terminated for Cause unless the
Employee shall have been provided with (i) a reasonable notice setting forth
the reasons that the Company believes constitute Cause for the termination of
his employment; (ii) a Notice of
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Termination as defined in Section 7(e), from the Board finding that, in the
reasonable good faith opinion of the Board, Cause for the termination exists
and specifying the particulars thereof in reasonable detail.
(d) Termination by the Employees.
(1) The Employee may terminate his employment (A) for Good
Reason by giving ten days prior written notice to the Company or (B) at any
time by giving 120 days prior written notice to the Company.
(2) For this purpose, "Good Reason" shall mean (A) the
assignment to the Employee of any duties inconsistent with the Employee's
status as Chairman of the Board of the Company or any substantial adverse
alteration in the nature or status of the Employee's responsibilities; (B)
any change in the Employee's reporting responsibility such that the Employee
is required to report other than exclusively to the Board; (C) any purported
termination of the Employee's employment by the Company that is not effected
pursuant to a Notice of Termination satisfying the requirements of Section
7(e) hereof; (D) any other failure by the Company to comply with any material
provision of this Agreement which failure continues for more than ten days
after written notice of such noncompliance from the Employee; or (E) any
notices given by the Company to the Employee under Section 5 hereof that this
Agreement will not be renewed on any anniversary date.
(e) Notice of Termination. Any termination of the Employee's
employment by the Company or by the Employee (other than termination pursuant
to Section 7(a) or 7(b) hereof) shall be communicated to the other party by a
written Notice of Termination. Any Notice of Termination given by a party
shall specify the particular termination provision of this Agreement relied
upon by such party and shall set forth in reasonable detail the facts and
circumstances relied upon as providing a basis for the termination under the
provision so specified.
(f) Termination Date. The Termination Date shall mean (1) if the
Employee's employment is terminated by his death, the date of his death; (2)
if the Employee's employment is terminated pursuant to Section 7(b) hereof,
the date specified in the Notice of Termination, which shall be after the
expiration of the six-month period specified in that subsection; (3) if the
Employee's employment is terminated by the Company for Cause, the date
specified in the Notice of Termination; or (4) if the Employee's employment
is terminated for any other reason, sixty days following the date on which
the Notice of Termination is given.
8. Compensation Upon Termination of Employment.
(a) Termination because of Death for Cause or Without Good Reason.
If the Employee's employment is terminated because of his death, by the
Company for Cause or by the Employee other than for Good Reason, the Company
shall pay the Employee his salary and a pro rata portion of the bonus
specified in Section 2(b) (based upon the bonus paid in respect of the
preceding
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year) through the Termination Date of the Company shall have no further
obligation to the Employee hereunder.
(b) Termination because of Disability. If the Employee's employment
is terminated by the Company because of Disability under Section 7(b) hereof
the Company shall pay the Employee an annual disability benefit equal to the
excess of (1) 60 percent of his salary at the rate in effect under Section
2(a) hereof on the Termination Date plus 60 percent of the bonus amount
specified in Section 2(b) hereof (based upon the bonus paid in respect of the
preceding year) over (2) the amount of the long term disability benefit that
is payable to the Employee under any policy of disability insurance provided
for the Employee by the Company at its expense. The disability benefit shall
be paid for such period as is determined by the Board of Directors for the
Company's senior executives but shall not be less than the remainder of the
scheduled term of employment.
(c) Termination without Cause of with Good Reason. If (i) in breach
of this Agreement, the Company shall terminate the Employee's employment
other than (A) for Cause or (B) because of Disability or (ii) the Employee
shall terminate his employment for Good Reason; then:
(l) The Company shall pay the Employee his salary and a pro
rata portion of the bonus specified in Section 2(b) hereof (based upon the
bonus paid in respect of the preceding year) through the Termination Date and
all other unpaid and pro rata amounts to which the Employee is entitled as of
the Termination Date under any compensation plan or program of the Company,
including, without limitation, any incentive performance bonus and all
accrued vacation time;
(2) The Company shall pay as liquidated damages to the
Employee, and in lieu of any further salary payments hereunder for periods
after the Termination Date, the Employee's then current salary (payable in
installments in accordance with the Company's normal payroll practices) for
the remainder of the scheduled term of employment and the product of (A) the
sum of (i) the Employee's annual bonus specified in Section 2(b) hereof
(based upon the bonus paid in respect of the preceding year) and (ii) the
maximum annual bonus amount that could have been paid to the Employee under
the Company's performance incentive bonus plan for the year in which the
Termination Date occurs, and (B) the number of years (and any fraction of a
year) remaining in the term of this Agreement under Section 5 hereof as of
the Termination Date, which amount shall be payable in equal monthly
installments during the remainder of the scheduled term of employment;
(3) In addition to the liquidated amounts that are payable to
the Employee, the following shall apply: (A) the Employee shall continue to
participate in, and accrue benefits under, all retirement, pension, profit
sharing, employee stock ownership, thrift and other deferred compensation
plans of the Company for the remaining term of this Agreement as if the
termination of employment of the Employee had not occurred (with the Employee
being deemed to receive annually for the purposes of such plans the
Employee's then current salary and bonus (at the time of his termination)
under Section 2(a) and (b) of this Agreement), except to the extent that such
plan constitutes a "qualified plan" under Section 401 of the Internal Revenue
Code of 1986, as amended ("Code"), by the terms of the plan, in which case
the Company shall provide the Employee a substantially
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equivalent, unfunded, non-qualified benefit; (B) the Employee shall be
entitled to continue to receive all other employee benefits and then existing
fringe benefits referred to in Section 4(a) and (b) hereof for the remaining
term of this Agreement as if the termination of employment had not occurred;
and (C) all insurance or other provisions for indemnification, defense or
hold-harmless of officers or directors of the Company that are in effect on
the date the Notice of Termination is sent to the Employee shall continue for
the benefit of the Employee with respect to all of his acts and omissions
while an officer or director as fully and completely as if such termination
had not occurred, and until the final expiration or running of all periods of
limitation against action which may be applicable to such acts or omissions;
and
(4) The liquidated amount and other benefits provided for in
this Section 8(c) shall not be reduced by any compensation or benefits that
the Employee may receive for other employment with another employer through
self-employment after termination of employment with the Company.
(d) Cost of Enforcement. In the event the employment of the
Employee is terminated by the Company because of Disability or without Cause,
or by the Employee for Good Reason, and the Company fails to make timely
payment of the amounts owed to the Employee under this Agreement, the
Employee shall be entitled to reimbursement for all reasonable costs,
including attorney's fees, incurred in the Employee in taking action to
collect such amounts or otherwise to enforce this Agreement, plus interest on
such amounts at the rate of one percent above the prime rate (defined as the
base rate on corporate loans at large U.S. money center commercial banks as
published by The Wall Street Journal), compounded monthly, for the period
from the date of employment termination until payment is made to the
Employee. Such reimbursement and interest shall be in addition to all rights
to which the Employee is otherwise entitled under this Agreement.
(e) Parachute Payment Limitation. If any payment or benefit to the
Employee under this Agreement would be considered a "parachute payment"
within the meaning of Section 280(g)(b)(2) of the Code and if, after reduction
for any applicable federal excise tax imposed by Section 4999 of the Code
("Excise Tax") and federal income tax imposed by the Code, the Employee's net
proceeds of the amounts payable and the benefits provided under this
Agreement would be less than the amount of the Employee's net proceeds
resulting from the payment of the Reduced Amount described below, after
reduction for federal income taxes, then the amount payable and the benefits
provided under this Agreement shall be limited to the Reduced Amount. The
"Reduced Amount" shall be the largest amount that could be received by the
Employee under this Agreement such that no amount paid to the Employee under
this Agreement and any other agreement, contract or understanding heretofore
or hereafter entered into between the Employee and the Company ("Other
Agreements") and any formal or informal plan or other arrangement heretofore
or hereafter adopted by the Company for the direct or indirect provision of
compensation to the Employee (including groups or classes or participants or
beneficiaries of which the Employee is a member), whether or not such
compensation is deferred, is in cash, or is in the form of a benefit to or
for the Employee ("Benefit Plan") would be subject to the Excise Tax. In the
event that the amount payable to the Employee shall be limited to the Reduced
Amount, the Employee shall have the right, in the Employee's sole discretion,
to designate those payments or benefits under this
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Agreement, any other Agreements, and/or Benefit Plank, that should be reduced
or eliminated so as to avoid having the payment to the Employee under this
Agreement be subject to the Excise Tax.
9. Confidentiality. In consideration of the willingness of the Company to
employ the Employee and the compensation to be paid and benefits to be
received therefor, any for other good and valuable consideration, the receipt
and adequacy of which is hereby acknowledged, the Employee agrees as follows:
(a) The Company Owns All of the Employee's Work. All improvements,
discoveries, inventions, designs, documents, licenses and patents, or other
data devised, conceived, made, developed, obtained, filed, perfected,
acquired, or first reduced to practice, in whole or in part, or in the
regular cause of employment by the Employee during the term of this
Agreement, and related in any way to the Business, including development and
research, of the Company or any subsidiary or affiliate engaged in business
substantially similar to that of the Company shall be promptly disclosed to
the Company. The Employee hereby assigns and transfers to the Company all his
right, interest and title thereto, and such improvements, discoveries,
inventions, designs, documents, licenses and patents, or other data shall
become the property of the Company. During the term of this Agreement and at
any time thereafter, upon request of the Company, the Employee will join and
render assistance in any proceedings and execute any papers necessary to file
and prosecute applications for, and to acquire, maintain and enforce, letters
patent, trademarks, registrations and/or copyrights, both domestic and
foreign, with respect to such improvements, discoveries, inventions, designs,
documents, licenses and patents, or other data as required for vesting and
maintaining title to same in the Company.
(b) Non-Disclosure of Confidential Information. The Employee agrees
and acknowledges that the term "Confidential and Proprietary Information"
shall mean any and all information not in the public domain, in any form,
emanating from or relating to the Company and its subsidiaries and
affiliates, including, but not limited to, trade secrets, technical
information, costs, designs, drawings, processes, systems, methods of
operation and procedures, formulae, test data, know-how, improvements, price
lists, financial data, code books, invoices and other financial statements,
computer programs, discs and printouts, sketches, and plans (engineering,
architectural or otherwise), customer lists, telephone numbers, names,
addresses, information about equipment and processes (including
specifications and operating manuals), or any other complication of
information written or unwritten that is used in the business of the Company
or any subsidiary or affiliate that gives the Company or any subsidiary or
affiliate any opportunity to obtain an advantage over competitors of the
Company who do not know or use such information. The Employee agrees and
acknowledges that all Confidential and Proprietary Information, in any form,
and all copies and extracts thereof, is and are and shall remain the sole and
exclusive property of the Company and, upon termination of his employment
with the Company, the Employee hereby agrees to return to the Company the
originals and all copies of any Confidential and Proprietary Information
provided to or acquired by the Employee during the period of his employment.
Except as ordered by a court of competent jurisdiction, the Employee
expressly agrees never to disclose to any person (except to other Company
employees, and then only on a "need to know" basis) or entity any
Confidential and
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Proprietary Information either during the term of this Agreement or at any
time after termination of his employment, except with the express written
authorization and consent of the Company.
(c) Customer's Information. The Employee understands and
acknowledges that each customer of the Company or its subsidiaries or
affiliates will disclose information that will be within the Company's
control in connection with the Company's furnishing of services to its
customer. The Employee covenants and agrees to hold such information in the
strictest confidence and shall treat such information in the same manner and
be obligated by the provisions of this Agreement as if such information were
Confidential and Proprietary Information, as defined in Section 9(b) hereof.
10. Covenant Not to Compete. During the term of employment and for a
period of three (3) years after the termination of the Employee's employment
by the Company, the Employee shall not directly or indirectly own, manage,
operate, control or be employed by or participate in the ownership,
management, operation or control of any business in the Northern Virginia
area which is the type and character engaged in and competitive with that of
the Employer. The Employee shall not, during the term of this Agreement, have
any other paid employment other than with a subsidiary or affiliate of the
Company, except with the Prior approval of the Board.
11. Amendments or Additions: Action by Board. No amendments or additions
to the Agreement shall be binding unless in writing and signed by all parties
thereto. The prior approval by a majority affirmative vote of the full Board
shall be required in order for the Company to authorize any amendments or
additions to this Agreement, to give any consents or waivers of provisions of
this Agreement, or to take any other action under this Agreement including
any Notice of Termination.
12. Miscellaneous.
(a) Notices. Any notice required or permitted hereunder shall be
given in writing and shall be personally delivered or mailed by first class
registered or certified mail, postage prepaid, return-receipt-requested, or
transmitted by facsimile, telegram or telex, addressed to the Company or the
Employee at the address set forth on the signature page of this Agreement, or
at such other addresses as such party may designate by five business day
advance written notice to the other party.
Each notice or communication that shall have been transmitted
in the manner described above, or that shall have been delivered to a
telegraph company, shall be deemed sufficiently given, served, sent or
received for purposes at such time as it is sent to the addressee (with the
return receipt, delivery receipt or (with respect to a telex) the answer back
being deemed conclusive, but not exclusive, evidence of such sending) or at
such time as delivery is refused by the addressee upon presentation.
(b) Servability. Nothing in this Agreement shall be construed so as
to require the commission of any act contrary to law and wherever there is
any conflict between any provision of this Agreement and any law, statute,
ordinance, order or regulation, the latter shall prevail, but in such event
any necessary action will be taken to bring it within applicable legal
requirements. If any
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provision of this Agreement should be held invalid or unenforceable, the
remaining provisions shall be unaffected by such a holding.
(c) Complete Agreement. This Agreement contains the entire Agreement
and understanding between the parties relating to the subject matter hereof,
and supersedes any prior understandings, agreements or representations by or
between the parties, written or oral, relating to the subject matter hereof.
(d) Successors or Assigns. This Agreement and the rights and
obligations of the parties hereto shall bind and inure to the benefit of any
successor or successors of the Company by way of reorganization, merger or
consolidation and any assignee of all or substantially all of its business
assets, but except as to any such successor or assignee of the Company,
neither this Agreement nor any rights or benefits hereunder may be assigned
by the Company or the Employee. However, in the event of death of the
Employee all rights to receive payments hereunder shall become rights or
benefits hereunder may be assigned by the Company or the Employee. However,
in the event of the death of the Employee all rights to receive payments
hereunder shall become rights of the Employee's estate.
(e) Section Headings. The section headings used in this Agreement
are included solely for convenience and shall not affect, or be used in
connection with, the interpretation of this Agreement.
(f) Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement on the day and year first above written.
CROPKING, INCORPORATED EMPLOYEE
By: /s/ Xxxx Xxxxxxxxxx By: /s/ Xxxxxx X. Brentling
------------------------ -----------------------
Xxxx Xxxxxxxxxx Xxxxxx X. Brentling
Secretary
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