EXHIBIT 10.2
April __, 1998
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Dear ▇▇. ▇▇▇▇▇▇▇▇:
Omega Protein Corporation (the "Company") has determined that it is in the
best interests of the Company and its shareholders to assure that the Company
will have your continued dedication, and to provide you (the "Executive") with
compensation and benefits arrangements which are competitive with those of other
corporations and which ensure that your compensation and benefits expectations
will be satisfied. Therefore, in order to accomplish these objectives, the
Company does hereby enter into this agreement (this "Agreement"), which shall
supersede any other employment agreements between you and the Company.
In order to induce you to remain in the employ of the Company, it is agreed
as follows:
1. Employment. The Company hereby employs the Executive, and the Executive
hereby accepts such employment, all upon the terms and conditions set forth
herein.
2. Term. Subject to the terms and conditions set forth herein, the
Executive shall be employed for a continually renewing term of three (3) years
commencing on the date hereof and renewing each day thereafter for an additional
day without any further action by either the Company or the Executive, it being
the intention of the parties that there shall be continuously a remaining term
of three (3) years' duration of the Executive's Employment until an event has
occurred as described in, or one of the parties shall have made an appropriate
election pursuant to, the provisions of Section 5.
3. Duties and Responsibilities.
A. Capacity. The Executive shall serve in the capacity of Executive
Vice President and Chief Financial Officer of the Company and its
successors or in a substantially similar capacity with a
subsidiary, affiliate, or joint venture of the Company. The
Executive's duties under this Agreement shall consist of such
general management
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Page 2
activities as are consistent with the responsibilities of said
office and such other activities as may hereafter be assigned to
him by the Chief Executive Officer of the Company or his designee
(the "Supervisor"). All such duties shall be performed in
accordance with any written or oral direction from time to time
furnished to the Executive by the Supervisor, and the Executive
shall report to Supervisor or to such officer of the Supervisor
or the Company as is designated by the Supervisor.
B. Full-Time Duties. The Executive shall devote his full business
time, attention and energies to the business of the Company and
shall not be engaged in any other business activity, whether or
not pursued for gain, profit or other pecuniary advantage, which
would impair his ability to fulfill his duties to the Company
under this Agreement, without the prior written consent of the
Company. The Executive shall be allowed, to the extent such
activities do not substantially interfere with the performance by
the Executive of his duties and responsibilities hereunder, to
(a) manage the Executive's personal affairs, and (b) (i) serve on
boards or committees of civic or charitable organizations or
trade associations, and (ii) serve on the board of directors of
any corporation; provided, however, that the Executive shall
advise the Company in writing of any such corporate directorship
under clause (b)(ii) and, if requested by the Company, the
Executive shall first demonstrate, to the reasonable satisfaction
of the Company, that any such directorship does not detract from
the Executive's performance of his duties and responsibilities
under this Agreement. Nothing contained in this paragraph B shall
prevent the Executive from passively investing his assets in such
a form or manner as will not conflict with the terms of this
Agreement and will not require services on the part of the
Executive in the operation of the business of the companies or
other enterprises in which such investments are made.
C. Standard of Performance. The Executive will perform his duties
under this Agreement with fidelity and loyalty, to the best of
his ability, experience and talent and in a manner consistent
with his fiduciary responsibilities.
D. Location. The Executive's primary place of employment shall be
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Executive shall not be required to relocate more than 35 miles
from
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consent.
4. Compensation.
A. Base Salary. The Company shall pay the Executive a salary (the
"Base Salary") of $155,000 per annum, prorated for partial years
of employment. The Base Salary shall be payable in accordance
with the general payroll practices of the Company in effect from
time to time. The Company shall review the Base Salary then being
paid to the Executive at such times as the Company regularly
reviews the compensation paid to employees generally (but no less
frequently than once each fiscal year). Upon completion of such
review, the Company in its sole discretion may increase, decrease
or maintain the Executive's then current Base Salary, provided,
however, that the Company may decrease the Executive's then
current Base Salary only with the prior written consent of the
Executive.
B. Benefits.
(1) Generally. The Executive shall be entitled to participate,
in accordance with the Company's regular practices with
respect to its similarly situated executives, in the
Company's pension, profit-sharing, bonus, disability,
accident, medical, life insurance, hospitalization plans and
any other employee benefit program maintained by the Company
for its similarly situated executives. The Company will have
the right to amend or terminate any such benefit plans it
may choose to establish.
(2) Reimbursements. The Executive shall be entitled to
reimbursement from the Company for reasonable out-of-pocket
expenses incurred by him in the course of the performance of
his duties hereunder, upon the submission of appropriate
documentation.
(3) Vacations and Other Absences. The Executive shall be
entitled to such vacation, holidays and, subject to the
provisions of Section 5, other paid or unpaid leaves of
absence as are consistent with the Company's normal policies
or as are otherwise approved by the Company.
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C. Payments. All payments to the Executive provided for under this
Agreement shall be paid in cash from the general funds of the
Company, and no special or separate funds shall be established
and no other segregation of assets shall be made to assure
payment. The Executive shall have no right, title or interest
whatsoever in or to any investments which the Company may make to
aid it in meeting its obligations hereunder. Nothing contained in
this Agreement, and no action taken pursuant to the provisions
hereof, shall create, or be construed to create, a trust of any
kind or any fiduciary responsibility of the Company to the
Executive or any other person. To the extent that any person
acquires a right to receive payments from the Company hereunder,
such right shall be no greater than the right of an unsecured
creditor of the Company.
5. Termination.
A. Termination by the Company. At the Company's election, this
Agreement may be terminated by the Company in any of the
following circumstances:
(1) If the Company shall have "Cause" (as hereinafter defined);
(2) If the Executive shall die; or
(3) If the Executive shall be unable, with reasonable
accommodation, to perform his duties hereunder owing to
illness or incapacity for a total of 120 days during any
360-day period;
The termination of the Executive's employment pursuant to this
Section 5.A. shall be effective (i) in the case of a termination
pursuant to paragraph (1) above, as of the date specified in
Section 5.B., (ii) in the case of a termination pursuant to
paragraph (2) above, at death, or (iii) in the case of a
termination pursuant to paragraph (3) above, upon the expiration
of 30 days' written notice from the Company to the Executive.
Upon any termination of the Executive's employment pursuant to
paragraph (1), (2) or (3) above, the Company shall have no
further liability or obligation under or in connection with this
Agreement, except to pay the portion of the Executive's Base
Salary and other benefits earned or accrued at the date of
termination. If the
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Executive is otherwise eligible for benefits under any long-term
disability plan sponsored by the Company, then a termination
solely pursuant to paragraph (3) above shall not affect the
Executive's entitlement to such benefits. In the event that the
Executive's employment with the Company is terminated by the
Company for any reason other than for Cause, death or disability
(as defined in paragraph (3) above), the Company shall have no
further liability or obligation under or in connection with this
Agreement except to pay the Executive the "Severance Payment" (as
defined below) in eighteen (18) equal monthly installments, the
first such installment payable within 10 days after the date of
termination and the remaining installments payable monthly
thereafter. For purposes of this Agreement, "Severance Payment"
shall mean an amount equal to 2.99 times the Executive's "base
amount" within the meaning of Sections 280G(b)(3) and 280G(d) of
the Internal Revenue Code of 1986, as amended (the "Code"), and
any applicable temporary or final regulations promulgated
thereunder, or its equivalent as provided in any successor
statute or regulation. If Code Section 280G (and any successor
provisions thereto) shall be repealed or otherwise be
inapplicable, then the Severance Payment shall be equal to 2.99
times the Executive's then current Base Salary. Should any of the
payments, singly, in any combination or in the aggregate, that
are provided for hereunder to be paid to or for the benefit of
the Executive be determined or alleged to be subject to an excise
or similar purpose tax pursuant to Section 4999 of the Code, or
any successor or other comparable federal, state or local tax law
by reason of being a "parachute payment" (within the meaning of
Section 280G of the Code), the Company shall pay to the Executive
such additional compensation as is necessary (after taking into
account all federal, state and local taxes payable by the
Executive as a result of the receipt of such additional
compensation) to place the Executive in the same after-tax
position (including federal, state and local taxes) he would have
been in had no such excise or similar purpose tax (or interest or
penalties thereon) been paid or incurred. Without limiting the
obligation of the Company hereunder, the Executive agrees to
negotiate with the Company in good faith with respect to
procedures reasonably requested by the Company which would afford
the Company the ability to contest the imposition of such excise
or similar purpose tax. The termination of the Executive's
employment by the Company other than for Cause shall be effective
as of the date specified in this Section 5.A.
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B. Cause. "Cause" means (i) the Executive's final conviction of a
felony crime that enriched the Executive at the expense of the
Company; or (ii) the Executive's deliberate and intentional
continuing failure to substantially perform his duties and
responsibilities hereunder (except by reason of the Executive's
incapacity due to physical or mental illness or injury) for a
period of forty-five (45) days after the "Required Board
Majority" (as defined below) has delivered to the Executive a
written demand for substantial performance hereunder which
specifically identifies the bases for the Required Board
Majority's determination that the Executive has not substantially
performed his duties and responsibilities hereunder (such period
being the "Grace Period"); provided, that for purposes of this
clause (ii), the Company shall not have Cause to terminate the
Executive's Employment unless (a) at a meeting of the Board
called and held following the Grace Period in the city in which
the Company's principal executive offices are located of which
the Executive was given not less than ten (10) days' prior
written notice and at which the Executive was afforded the
opportunity to be represented by counsel, appear and be heard,
the Required Board Majority shall adopt a written resolution
which (1) sets forth the Required Board Majority's determination
that the failure of the Employee to substantially perform his
duties and responsibilities hereunder has (except by reason of
his incapacity due to physical or mental illness or injury)
continued past the Grace Period and (2) specifically identifies
the bases for that determination and (b) the Company, at the
written direction of the Required Board Majority, shall deliver
to the Executive a notice of termination for Cause to which a
copy of that resolution, certified as being true and correct by
the secretary or any assistant secretary of the Company, is
attached. No act or failure to act on the part of the Executive
shall be considered "deliberate and intentional" unless it is
taken or omitted to be taken by the Executive in bad faith or
without a reasonable belief that the Executive's act or omission
was in the best interests of the Company. "Required Board
Majority" means at any time a majority of the members of the
Board of Directors of the Company at that time which includes at
least a majority of the outside directors at that time.
Termination of the Executive's employment by the Company for
Cause shall be effective on the date of the notice of termination
for Cause is delivered to the Executive.
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C. Termination by the Executive. In the event that the Executive
terminates employment hereunder for "Good Reason" (as defined in
Section 5.D), the Company shall have no further liability or
obligation under or in connection with this Agreement, except to
pay the Executive the Severance Payment in eighteen (18) equal
monthly installments, the first such installment payable within
ten (10) days after the date of termination and the remaining
installments payable monthly thereafter. The termination of the
Executive's employment for "Good Reason" shall be effective as of
the date specified in Section 5.D. In the event that the
Executive voluntarily terminates employment hereunder for other
than "Good Reason" (as defined in Section 5.D), the Company shall
have no further liability or obligation under or in connection
with this Agreement. Upon any termination or expiration of the
Executive's employment hereunder, the Executive shall have no
further liability or obligation under or in connection with this
Agreement; provided, however, that the Executive shall continue
to be subject to the provisions of Sections 6 and 7 hereof (it
being understood and agreed that such provisions shall survive
any termination or expiration of the Executive's employment
hereunder). Upon any voluntary termination by the Executive, for
any reason other than Good Reason, or expiration of Executive's
employment hereunder, the Company shall have no further liability
under or in connection with this Agreement, except to pay the
portion of the Executive's Base Salary earned or accrued at the
date of termination.
D. Good Reason. The Executive's employment hereunder shall be deemed
to have been terminated for "Good Reason" if such termination of
employment occurs within one year following either (i) a
diminution in the compensation (without the consent of the
Executive), or a material diminution of responsibilities of the
Executive, (ii) ▇▇▇▇▇▇ Corporation (the "Parent") or any
subsidiary of the Parent merging with or into or consolidating
with another corporation and as a result thereof less than 50% of
the outstanding voting securities of the Parent (or if the
outstanding voting securities of the Parent are converted into or
exchanged for voting securities of some other corporation, less
than 50% of the outstanding voting securities of such other
corporation ) are then owned in the aggregate by the stockholders
of the Parent immediately prior to such merger or consolidation;
(iii) the Executive being required to relocate more than 35 miles
from ▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
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Houston, Texas 77056, without his consent, (iv) any "person,"
within the meaning of Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), other than any
employee or Subsidiary of the Parent, any employee benefit plan
(or related trust) applicable to the Parent or any of its
Subsidiaries or ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or any corporation, person,
partnership, trust or other entity controlled, directly or
indirectly, by him becoming the beneficial owner (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of
securities of the Company representing 20% or more of the
combined voting power of the Company's then outstanding voting
securities; or (v) the Company failing to comply with any
material provision of this Agreement. Termination of employment
for Good Reason shall be deemed to be effective upon 10 days'
written notice of termination from the Executive or the Company,
as the case may be; provided, however, that no termination by the
Executive based on a diminution in duties and responsibilities
shall occur until the Executive has first notified the Company in
writing as to the specific nature of the diminution in duties or
responsibilities and afforded the Company 15 days in which to
modify such duties or responsibilities.
6. Confidential Information.
Nondisclosure. The Executive hereby acknowledges that it will be
necessary in connection with the performance of services hereunder to
provide or make available to the Executive certain confidential and
proprietary information, including, but not limited to, business and
financial information, technological information, customer lists and
financial information on customers, intellectual property, trade
secrets and other information relating to the businesses, products,
technology, services, customers, methods or tactics of the Company or
its affiliates (any such confidential or proprietary information being
hereinafter referred to as "Confidential Information"). The Executive
further acknowledges that the Confidential Information includes
certain protected trade secrets and agrees that any such trade secrets
shall remain the property of the Company or its affiliates at all
times during the term of this Agreement and following the expiration
or termination hereof. The Executive shall not publish, disseminate,
distribute, disclose, sell, assign, transfer, copy, remove from the
Company's premises, commercially exploit, or otherwise make use of any
Confidential Information to or for the use or benefit of the Executive
or any other person, firm, corporation or entity, except as
specifically
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authorized in writing by the Company or as required for the due and
proper performance of his duties and obligations under this Agreement.
In addition, the Executive shall employ all necessary safeguards and
precautions in order to ensure that unauthorized access to the
Confidential Information is not afforded to any person, firm,
corporation or entity. Upon any expiration or termination of this
Agreement, or if the Company so requests at any time, the Executive
shall promptly return to the Company all Confidential Information in
the Executive's possession, whether in writing, on computer disks or
other media, without retaining any copies, extracts or other
reproductions thereof. Notwithstanding the foregoing, nothing
contained in this paragraph A shall prevent the publishing,
dissemination, distribution, disclosure, sale, assignment, transfer,
copying, removal, commercial exploitation or other use by the
Executive of any information which (i) is generally available to the
public (other than through a breach on the part of the Executive of
any of the terms or provisions hereof), (ii) is lawfully obtained by
the Executive from a source other than the Company or its affiliates,
directors, officers, employees, agents or other representatives
(provided, however, that such source is not bound by a confidentiality
agreement with the Company or any of its affiliates and is not
otherwise under an obligation of secrecy or confidentiality to either
of them), or (iii) is required to be disclosed by judicial or
administrative process or, in the opinion of counsel, by the
requirements of applicable law (provided, however, that the Executive
complies fully with the provisions of paragraph B below).Requests for
Disclosure. If the Executive is requested (whether by oral questions,
interrogatory, request for documents, subpoena, civil investigative
demand or other legal process) to disclose any part of the
Confidential Information, the Executive shall (i) give prompt written
notice to his supervisor of the existence of, and the circumstances
attendant to, such request, (ii) consult with his supervisor as to the
advisability of taking legally available steps to resist or narrow any
such request or otherwise to eliminate the need for such disclosure,
and (iii) if disclosure is required, cooperate with his supervisor in
obtaining a protective order or other reliable assurance in form and
substance satisfactory to his supervisor that confidential treatment
will be accorded to such portion of the Confidential Information as is
required to be disclosed.
7. Noncompetition. The Executive hereby expressly covenants and agrees,
which covenants and agreements are of the essence of this contract,
that he will not, directly or indirectly, for himself or on behalf of,
or in conjunction with, any other person, persons, company,
partnership or corporation,
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during the term of this agreement and for a period of two (2) years
immediately following his voluntary termination of employment
hereunder for other than Good Reason or his termination by the Company
for Cause:
i. call upon any customer or customers of the Company solicited or
contacted by the Executive or whose account was serviced by the
Executive, pursuant to his employment hereunder, for the purpose
of soliciting or selling marine protein products within the
territory stated in Paragraph 7.iv;
ii. divulge to any person, persons, company, partnership or
corporation the methods and systems used by the Company in
producing, selling or marketing marine protein products;
iii. induce or attempt to induce, directly or indirectly, any employee
to quit the Company's employ or otherwise in any manner interfere
with or disrupt the Company's relationship with other employees;
or
iv. engage in the marine protein business as an officer, director,
employee, partner, or consultant anywhere within the states of
Texas, Louisiana, Mississippi, Alabama, Florida, Georgia, South
Carolina, North Carolina, Virginia, or Maryland.
8. Arbitration. Any dispute or controversy arising under or in connection
with this Agreement shall be settled exclusively by final and binding
arbitration in Houston, Texas, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association ("AAA"). The
arbitrator shall be selected by mutual agreement of the parties, if
possible. If the parties fail to reach agreement upon appointment of
an arbitrator within 30 days following receipt by one party of the
other party's notice of desire to arbitrate, the arbitrator shall be
selected from a panel or panels of persons submitted by the AAA. The
selection process shall be that which is set forth in the AAA
Commercial Arbitration Rules then prevailing, except that, if the
parties fail to select an arbitrator from one or more panels, AAA
shall not have the power to make an appointment but shall continue to
submit additional panels until an arbitrator has been selected. This
agreement to arbitrate shall not preclude the parties from engaging in
voluntary, non-binding settlement efforts including mediation.
9. Notices. All notices and other communications hereunder shall be in
writing and shall be given (and shall be deemed to have been duly
given
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upon receipt) by Federal Express overnight delivery, to the respective
parties at the following addresses (or at such other address as either
party shall have previously furnished to the other in accordance with
the terms of this Section 9):
If to the Company:
President and Chief Executive Officer
Omega Protein Corporation
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If to the Executive:
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10. Amendment; Waiver. The terms and provisions of this Agreement may be
modified or amended only by a written instrument executed by each of the parties
hereto, and compliance with the terms and provisions hereof may be waived only
by a written instrument executed by each party entitled to the benefits thereof.
No failure or delay on the part of any party in exercising any right, power or
privilege granted hereunder shall constitute a waiver thereof, nor shall any
single or partial exercise of any such right, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege granted hereunder.
11. Entire Agreement. This constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes all prior
written or oral agreements or understandings between the parties relating
thereto.
12. Severability. In the event that any term or provision herein is found
to be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining terms and provisions hereof shall not be in any
way affected or impaired thereby, and shall be construed as if such invalid,
illegal or unenforceable provision had never been contained therein.
13. Binding Effect; Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns
(it being understood and agreed that, except as expressly provided herein,
nothing contained
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herein is intended to confer upon any other person or entity any rights,
benefits or remedies of any kind or character whatsoever). Neither party may
assign this Agreement without the prior written consent of the other party;
provided, however, that the Company may assign this Agreement to any of its
affiliates or to any successor.
14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas (except that no effect shall be
given to any conflicts of law principles thereof that would require the
application of the laws of another jurisdiction).
15. Headings. The headings of the sections contained herein are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision hereof.
16. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
If this letter sets forth our agreement on the subject matter hereof,
kindly sign and return to the Company the enclosed copy of this letter which
will then constitute our agreement on the subject.
OMEGA PROTEIN CORPORATION
By:
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President and Chief Executive Officer
ACKNOWLEDGED AND AGREED TO:
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