EXHIBIT 10.9
EMPLOYMENT AGREEMENT
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") dated as of the 11th day of November
1997 (the "Commencement Date"), between Minnesota Corn Processors ("Company")
and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("Employee").
The Company and the Employee agree as follows:
1. EMPLOYMENT CAPACITY. The Employee will serve as Chief Operating
Officer of Minnesota Corn Processors ("MCP") and Chief Executive Officer of
Liquid Sugars, Inc. ("LSI") from the Commencement Date until the later of (i)
December 31, 1999, unless it is terminated earlier under Section 6 of this
Agreement, or (ii) such later date that is agreed upon in writing by the Company
and Employee (the "Employment Term").
2. TERM OF AGREEMENT. The term of this Agreement shall commence on
the Commencement Date and shall continue through the later to occur of (i)
December 31, 1999, unless it is terminated earlier under Article 6 of this
Agreement, or such later date that the Company and Employee agree on in writing
provided, however, that neither the Company nor Employee shall have any
obligation or commitment to agree to an extension of the term of this Agreement.
If the contract is still in effect in December 1998, then during the month of
December 1998 Company will extend the term of this agreement for one additional
year and if, in its sole discretion, it decides to extend the term of the
Agreement, and further assuming that Employee is agreeable to such extension,
the Company and Employee will enter into a written amendment to this Agreement
that will provide such extension. Assuming this Agreement is extended, the
company will follow the same procedure in each succeeding December during which
this agreement is extant. Following the termination of this Agreement, each
party shall have the right to enforce all rights, and shall be bound by all
obligations undertaken by such party pursuant to this Agreement.
3. DEVOTION TO RESPONSIBILITIES. During the Employment Term, the
Employee shall devote all of his time and attention during normal business hours
to the business of the Company, and he will engage in or be employed by any
other business activity or business, whether or not such business activity or
business is for gain, profit or other pecuniary advantage; provided, however,
that nothing herein contained shall prohibit the Employee from (i) serving as a
member of the Board of Directors, Board of Trustees of the like of any for
profit or non-profit entity, or performing services of any type for any civic or
community entity, whether or not the Employee receives compensation therefore,
(ii) investing his assets in such form or manner as will require no more than
nominal services on
2
the part of the Employee in the operation of the business of the entity in
which such investment is made, and (iii) serving in various capacities with, and
attending meetings of, industry or trade groups and associations, including
without limitation the industry or trade groups and associations, including
without limitation the industry or trade groups and associations with which the
Employee is currently involved, as long as the Employee's engaging in any one or
more of the activities permitted by virtue of clauses (i), (ii) and (iii) above
does not or do not materially and unreasonably interfere with the ability of the
Employee to perform the services and discharge the responsibilities required of
him under this Agreement.
4. ANNUAL SALARY - BENEFITS. The Company will provide the Employee
with the compensation and benefits described below:
a. SALARY. An annual salary during the Employment Term
of $175,000 ("Annual Base Compensation") as may be adjusted from time to time in
accordance with paragraph 4(a), payable to the Employee in accordance with the
normal payroll cycle. Salary and performance reviews will be conducted on April
1st of each year of possible salary increases.
b. VACATION. Employee shall be entitled to two (2) weeks
vacation per year and an additional two (2) weeks of paid leave.
c. INCENTIVE COMPENSATION. Employee shall be eligible
for the annual discretionary bonus program.
d. 401(k) PLAN. Employee will be eligible to participate
in the 401(k) Plan as per 401(k) plan policy.
e. KEY EMPLOYEE MANAGEMENT STOCK PURCHASE PROGRAM.
Employee will be eligible to participate at the 10,000 bushel level in this
program.
f. INSURANCE BENEFITS. Employee shall be eligible for
insurance benefits on the 31st day of employment.
g. INTERIM EXPENSES. MCP will reimburse interim living
expenses (hotel, motel, phone, travel, etc.) for any initial period spent
working in Marshall, Minnesota.
h. ANNUITY. The Company shall reimburse the employee
approximately $13,000 each year in payment of the premium for an existing
universal benefit policy.
3
i. OTHER BENEFITS. The Company shall include Employee
among those persons for whom the Company provides other benefits during the
Employment Term.
5. EXPENSES. The Employee will be reimbursed for reasonable
out-of-pocket expenses incurred from time to time on behalf of the Company or
any subsidiary in the performance of his duties under this Agreement, upon the
presentation of such supporting invoices, documents and forms as the Company
reasonably requests.
6. TERMINATION.
a. GROUNDS FOR TERMINATION DURING THE EMPLOYMENT TERM.
This Agreement shall terminate prior to the expiration of the Employment Term in
the event that at any time during such Employment Term:
(1) Employee dies, or
(2) Employee becomes "disabled," or
(3) The Board of Directors of the Company
notifies Employee in writing that the Agreement is being
terminated for "cause," or
(4) The Board of Directors of the Company
elects to terminate this Agreement without "cause" and
notifies Employee in writing of such election,
(5) Employee elects to terminate this
Agreement and notifies the Company in writing of such
election.
If this Agreement is terminated pursuant to subsection (1), (2), (3) or (4) of
this Section, such termination shall be effective immediately. If this Agreement
is terminated pursuant to subsection a(5) of this Section, such termination
shall be effective thirty (30) days after delivery of the notice of termination.
b. DEFINITIONS. For purposes of this Agreement, the
following definitions shall apply:
(1) "Cause" shall mean Employee (i) has
engaged in any willful and material misconduct,
including willful and material failure to perform his
duties as an officer or employee of the Company, and has
failed to cure such default within thirty
4
(30) days after receipt of written notice of such
conduct from the Company, or (ii) has committed fraud,
misappropriation or embezzlement with the Company's
business or assets, or (iii) has been convicted or
pleaded nolo contendere to criminal misconduct
(excluding misdeamors or traffic violations), or (iv)
has used narcotics, liquor or illicit drugs resulting a
detrimental effect on the performance of his employment
responsibilities.
(2) "Disability" shall mean that this
Agreement and Employee's employment shall terminate if
Employee sustains a disability which is serious enough
that he is not able to perform the essential functions
of his job, with our without reasonable accommodations,
as defined by various state and federal disability laws.
Employee shall be presumed to have such a disability for
the purpose of this Agreement if Employee qualifies,
because of injury, illness or incapacity, to begin
receiving disability income insurance payments under the
long term disability income insurance policy that
Company maintains for the benefit of its officers
generally. If there is no such policy in effect at the
date of the Employee's injury, illness or incapacity,
Employee shall be presumed to have such a disability for
the purpose of this Agreement if Employee is
substantially incapable of performing his duties for a
period of more than twelve (12) weeks.
c. TERMINATION OF EMPLOYMENT AFTER THE EMPLOYMENT TERM.
Upon expiration of the Employment Term, Employee's employment by the Company may
be terminated with or without cause by the Board of Directors of the Company by
providing notice to Employee.
d. EFFECT OF TERMINATION. Notwithstanding the
termination of employment hereunder, Employee, in consideration of his
employment hereunder to the date of such termination, shall remain bound by the
provisions of this Agreement which specifically relate to periods, activities or
obligations upon or subsequent to the termination of Employee's employment.
▇. ▇▇▇▇▇▇▇▇▇ PAYMENT. If Employee's employment is
terminated by the Company during the Employment Term pursuant to Section
6.a(11), the Company shall pay to Employee a cash severance payment equal to his
weekly compensation rate, times the number of weeks between the date of
termination of employment and (last day of Employment Term). It is understood
and agreed that no severance payment shall be due in the event employment is
terminated (i) during the Employment Term as provided in Section 6.a(1), (2),
(3), or (5), or (ii) for any reason on or after (last day of Employment Term) in
which case Employee's right to salary and benefits shall immediately terminate,
except as may be otherwise provided by applicable law.
5
7. TRADE SECRETS, ETC. The Employee shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge or data (including without limitation all financial information)
relating to the Company or any of its subsidiaries or corporate affiliates and
their respective business and operations, which shall have been obtained by the
Employee during the Employee's employment (whether prior to or after the
Commencement Date) and which shall not have become public knowledge (other than
by acts of the Employee or any of his representatives in violation of this
Agreement). At the end of the Employment Term, the Employee agrees (i) not,
without the prior written consent of the Company or as may be otherwise required
by law or legal process, to communicate or divulge any such information,
knowledge or data to any party other than the Company and (ii) to deliver
promptly to the Company any confidential information, knowledge or data in his
possession, whether produced by the Company or any of is subsidiaries and
corporate affiliates or by the Employee, that related to the corporate
affiliates or by the Employee, that related to the business of the Company or
any of its subsidiaries and joint ventures or any past, current or prospective
activity of the Company or any of its subsidiaries and joint ventures during the
term of this Employment Agreement, then Employee shall likewise hold such in a
fiduciary capacity and shall return such confidential data. In either event, the
Employee shall be permitted to retain copies of such data as are necessary in
order to enable the Employee to assert any rights under this Agreement, provided
that such data shall be used solely for such purpose.
8. CUSTOMER LISTS. The Employee recognizes and acknowledges that any
written list or lists of the customers of the Company or any of its subsidiaries
and joint ventures ("customer lists"), such as customer lists may exist from
time to time, are valuable, special and unique assets of the Company. The
Employee agrees that he will not use for his own personal benefits or disclose
such customer lists to any person, firm, corporation, association or other
entity for any such reason or purpose whatsoever.
9. INJUNCTIVE RELIEF. In the event of a breach or threatened breach
by the Employee of the provisions of section 8 and 10 of this Agreement during
or after the term of this Agreement, the Company shall be entitled to injunctive
relief restraining the Employee from violation of such paragraph. Nothing herein
shall be construed as prohibiting the Company from pursuing any other remedy at
law or in equity it may have in the event of breach or threatened breach of the
Agreement by the Employee.
10. BINDING EFFECT.
a. This Agreement shall be binding upon and inure to the
benefit of the Company and any of its successors or assigns.
6
b. This Agreement is personal to the Employee and shall
not be assignable by the Employee without the consent of the Company (there
being no obligation to give such consent) other than such rights or benefits as
are transferred by will or the laws of descent and distribution.
c. The Company will require any successor or assign
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the assets or businesses of the Company (i) to
assume unconditionally and expressively this Agreement and (ii) to agree to
perform all of the obligations under this Agreement in the same manner and to
the same extent as would have been required of the Company had no assignment or
succession occurred, such assumption to be set forth in a writing reasonably
satisfactory to the Employee. In the event of any such assignment or succession,
the term "Company" as used in this Agreement shall refer also to such successor
or assign.
11. EXPENSES RELATING TO ENFORCEMENT OF RIGHTS. If either party
shall successfully seek to enforce any provision of this Agreement or to collect
any amount claimed to be due hereunder, each successful party shall be entitled
to be reimbursed by the other party for any and all of its out-of-pocket
expenses, including reasonable attorneys' fees, incurred in connection with such
enforcement and/or collection.
11. NOTICES. Any notice or other communication required under this
Agreement shall be in writing, shall be deemed to have been given and received
when delivered in person, or, if mailed, shall be deemed to have been given when
deposited in the United States mail, first class, registered or certified,
return receipt requested, with proper postage prepaid, and shall be deemed to
have been received on the third business day thereafter, and shall be addressed
as follows:
If to the Company, addressed to:
Minnesota Corn Processors
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
If to the Employee, addressed to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
or such other address as to which any party thereto may have notified the other
in writing.
7
13. GOVERNING LAW. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of Minnesota.
14. ENTIRE AGREEMENT AND GOVERNING LAW. This Agreement and Governing
Law and the documents referred to herein, contain or refer to the entire
arrangement or understanding between the Employee and the Company relating to
the employment of the Employee by the Company and supersedes and replaces all
previous agreements and discussions relating to similar subjects between the
Employee and the Company. No provision of their Agreement may be modified or
amended except by an instrument in writing signed by or for both parties hereto
and on behalf of the Company, such modification must be signed by the President
of the Company.
15. SEVERABILITY. If any term or provision of this Agreement, or the
application thereof to any person or circumstance, shall at any time or to any
extent be invalid or unenforceable, the remainder of this Agreement, or the
application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby and each term of the provision of this Agreement shall be valid and
enforced to the fullest extent permitted by law.
16. WAIVER OF BREACH. The waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach thereof.
17. ARBITRATION. Any controversy or claim arising out of or relating
to this Agreement, the breach thereof, Employee's employment with the Company,
or the termination thereof, shall be settled by arbitration in accordance with
the Commercial Arbitration Rules of the American Arbitration Association (AAA),
and judgement upon the award rendered by the arbitrator may be entered in any
court having jurisdiction thereof. To select an arbitrator, each party shall
strike a name from the list submitted by AAA with the grieving party striking
first. The arbitrators will not have the power to add to or ignore any of the
terms and conditions of this Agreement. His decision shall not go beyond what is
necessary for the interpretation and application of this Agreement and
obligations of the parties under this Agreement. The cost of such arbitration,
but not attorneys' fees, will be paid by the losing party.
18. BENEFICIARIES. Whenever this Agreement provides for any payment
to be made to the Employee or his estate, such payment may be made instead to
such beneficiary or beneficiaries as the Employee may have designated in writing
and filed with the Company. The Employee shall have the right to revoke any such
designation from time to time and to redesignate any beneficiary to
beneficiaries by written notice to the Company.
8
19. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original all of which
together shall constitute one and the same instrument.
MINNESOTA CORN PROCESSORS
By: /s/ L. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 11-18-97
Name: L. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Date
Title: President
EMPLOYEE:
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 11-18-97
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Date