EXHIBIT 10.27
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT sets forth the agreement reached the 9th day of
December, 1996, by and between XXXXX X. XXXX (hereinafter referred to as
"Employee") and AgriBioTech, Inc., a Nevada Corporation (hereinafter referred
to as "Corporation").
WITNESSETH
WHEREAS, the Corporation desires to employ the Employee; and
WHEREAS, the Employee desires to accept such employment with the
Corporation; and
WHEREAS, the Employee and the Corporation desire to set forth their
employment relationship in a written agreement.
NOW THEREFORE, in consideration of the mutual promises and covenants herein
set forth, and for other valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follow:
ARTICLE 1.00 - EMPLOYMENT
1.01 EMPLOYMENT. The Corporation hereby offers to employ the Employee upon
the terms and conditions hereinafter set forth and the Employee accepts such
offer and agrees to abide by the terms and conditions hereof, and the terms and
conditions of the Corporation's and its affiliated corporations' Articles of
Incorporation, Bylaws and Employee Manual except as otherwise set forth herein.
The Employee shall be considered a Regular Employee from the effective date of
employment, i.e., not a Probationary Employee.
1.02 DUTIES. Employee shall perform all services reasonably required by
the Corporation in furtherance of the Corporation's business purposes as
determined, from time to time, by the Board of Directors of the Corporation.
The Employee will work only for AgriBioTech, Inc. and its subsidiaries, as may
be needed. In addition and as part of his duties hereunder, the Employee shall,
if elected to such position, serve as an officer and/or director of the
Corporation. Employee's title shall be Vice President, Corporate Development &
Strategic Planning. Employee shall report directly to the President of the
Corporation.
ARTICLE 2.00 - TERM AND TERMINATION
2.01 TERM. The Corporation agrees to employ the Employee commencing on
January 15, 1997 and continuing for at least four years from the date of
employment unless terminated pursuant to 2.02 below.
2.02 TERMINATION. The Corporation may, by giving zero (0) days notice to
the Employee, terminate this Agreement with cause. Notwithstanding the above,
this Agreement shall terminate immediately upon the death of the Employee, and
shall terminate upon ten (10) working days notice by the Corporation if, in the
opinion of the Corporation, Employee becomes unable to perform services required
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pursuant to this Agreement because of illness or injury. Any decision to
terminate this Agreement by the Corporation shall not be voted upon by the
Employee in any capacity whatsoever. In no event shall termination of this
Agreement relieve the parties hereto of any rights or obligation which survive
the termination of this Agreement as set forth herein. Termination as a result
of ownership or management changes: It is understood and agreed that current
management and "control" owners, i.e., Xxxxxx X. Xxxxxx, Xxxx X. Xxxxxxx and
Xxxxx X. Xxxxxx desire Employee to become an integral part of the core
management team. As such, Employee is to diligently utilize his talents,
experience and expertise to rapidly grow the Corporation per the Corporation's
goals and objectives. It is understood that both the Corporation and Employee
are making at least a four year commitment. In the event there is a material
change in ownership or management of the Corporation and at any time thereafter
(i) the Employee is terminated or (ii) in the sole determination of the
Employee, there is a significant change in the duties, responsibilities,
principal location of employment, or compensation of the Employee, then Employee
shall immediately be vested in full on all stock options referenced in Section
3.02 and shall be entitled to receive a payment equal to (a) his full
Compensation as set forth in Section 3.01 for two (2) years from the date of
such termination or determination, less $1, and (b) other employee benefits for
two (2) years from the date of such termination or determination. In addition
to the foregoing, for a period of one (1) year following any such change of
control or management, Employee shall have the option of terminating this
Agreement without justification and, in such event, will be entitled to (i)
immediately be vested in the stock options referenced in Section 3.02 which
would otherwise become vested on the next anniversary of employment following
such termination and (ii) receive his full Compensation as set forth in Section
3.01 and other employee benefits for one (1) year following such termination.
In the event Corporation desires to terminate this Agreement without cause,
Employee will be entitled to (i) immediately be vested in the stock options
referenced in Section 3.02 which would otherwise become vested on the next
anniversary of employment following such termination and (ii) receive his full
Compensation as set forth in Section 3.01 and other employee benefits for one
(1) years following such termination. In the event Employee desires to
terminate this Agreement, Employee agrees to give Corporation a minimum of three
(3) months notice and to assist Corporation in all reasonable respects in
finding a successor to the Employee's duties and responsibilities and in the
transition process.
ARTICLE 3.00 - COMPENSATION
3.01 SALARY. The Corporation covenants and agrees to pay Employee, as
consideration for his services, Compensation consisting of (i) an annualized
salary of NINETY THOUSAND DOLLARS ($90,000.00) through June 30, 1997; (ii)
$170,000 per year July 1, 1997 through June 30, 2001 plus either (a) a minimum
bonus of $30,000 per year July 1, 1997 through June 30, 2001, or (b)
reimbursement of personal expenses or "perquisites" aggregating $30,000 per year
for July 1, 1997 through June 30, 2001. Employee shall be entitled to an
increase in the above described Compensation annually beginning July 1, 1998.
Such increase will be determined by the Compensation Committee. The salary and,
if applicable, perquisites portions of Compensation will be payable in equal bi-
weekly installments, less payroll deductions for income tax, FICA, withholding
and any other deductions as authorized by the Employee. All bonuses included on
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compensation, if applicable, will be paid, less applicable payroll deductions,
in July of each year.
3.02 STOCK OPTIONS. Employee shall be granted 250,000 options to purchase
the Corporation's common stock. Ownership in said options shall vest on the
following schedule:
A) 25,000 vest at signing of Agreement.
B) 25,000 vest on 6/30/97, subject to Employee remaining employed by
Corporation.
C) 50,000 vest on 6/30/98, subject to Employee remaining employed by
Corporation.
D) 50,000 vest on 6/30/99, subject to Employee remaining employed by
Corporation.
E) 50,000 vest on 6/30/00, subject to Employee remaining employed by
Corporation.
F) 50,000 vest on 6/30/01, subject to Employee remaining employed by
Corporation.
Upon vesting, the first 125,000 options shall be exerciseable at a price of
$2.25 per share through June 30, 2002. Upon vesting, the second 125,000 options
shall be exerciseable at $3.50 per share through June 30, 2002. The options
shall be non-callable and the Corporation shall register the shares underlying
said options on the first applicable registration statement filed by the
Corporation. Such options shall be Incentive Stock Options to the extent
allowed under the Corporation's existing stock option plan. Payment for options
exercised may be made by Employee tendering common stock of the Corporation
owned by Employee valued at the then current market price of such stock in what
is generally referred to as pyramiding. Following exercise of options by the
Employee, the Corporation agrees to provide Employee with "stock depreciation
rights" to protect the Employee from declines in the value of the Corporation's
common stock for the period Employee is not able to sell such stock without (i)
being subject to the provisions of Section 16b of the Securities Exchange Act of
1934 and (ii) receiving capital gain treatment for income tax purposes. In
addition, Employee shall vest the 10,000 unvested director options upon
commencement of employment on January 15, 1997.
3.03 BONUS. For the purpose of causing Employee's compensation to equal
the reasonable value of this services to the Corporation and to reflect any
outstanding contribution to Corporation by Employee, the Corporation may pay
Employee, in addition to the compensation for services described in Section 3.01
above, a bonus in any amount determined by the Corporation in its sole
discretion. The bonus, if any, less payroll deductions for income taxes, FICA,
withholding and any other deductions authorized by the Employee, shall be paid
by the Corporation to the Employee at such time or times as the Corporation in
its sole discretion determines.
3.03 VACATION. During the term of this Agreement, the Employee shall be
entitled to a vacation pursuant to the Employee Manual, but not less than three
weeks per year during which time Employee's Compensation shall be paid in full.
Employee will be granted an accrual for two (2) weeks of vacation upon
commencement of employment and will be eligible to take any accrued vacation
upon commencement of employment.
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3.04 BENEFITS. During the term of this Agreement, the Employee shall be
entitled to receive insurance and other benefits generally available to all
employees of the Corporation. In the event Employee elects not to be covered by
certain of the Corporation's benefits, the Corporation will contribute the cost
it would otherwise incur toward alternate benefits obtained by the Employee.
3.05 RELOCATION. The Corporation and Employee agree that for the Employee
to perform the services required by the Corporation, it will be necessary for
the Employee to perform such services in Las Vegas, Nevada and therefore he must
relocate to Las Vegas. The Corporation will reimburse the Employee for the
reasonable and necessary expenses of such relocation. Such expenses will
include moving of the Employee's household goods, commission and other selling
expenses for the sale of the Employee's current residence, and expenses for
travel, lodging, meals, etc. for up to two house hunting trips to Las Vegas and
the actual relocation. Until Employee completes the relocation, a period not to
exceed six months, Corporation and Employee agree that to the extent possible,
Employee's work week will be structured to be completed in four consecutive days
and the Corporation will pay the costs of Employee's commuting between Las Vegas
and Illinois and Employee's expenses incurred for lodging, meals and
transportation in Las Vegas. Corporation agrees to allow Employee up to ten
days of compensated absence for house hunting and physically moving.
3.06 INDEMNIFICATION. The Corporation agrees to indemnify the Employee to
the full extent allowed by the Corporation's Articles of Incorporation and
Nevada law with respect to any claim, investigation, proceeding, or action
against or involving the Employee relating to this employment by the
Corporation. Such indemnification shall include advancement of attorney fees
during any such event and shall cover any adverse economic consequences to
Employee including judgments, settlements, and attorney fees. This Section 3.06
will survive termination of this Agreement irrespective of the reason for
termination.
ARTICLE 4.00 - SPECIFIC OBLIGATIONS OF THE PARTIES
4.01 CORPORATION'S OBLIGATIONS. The Corporation shall provide the employee
with and pay Employee's expenses for the following:
A. Such equipment, materials and supplies as the Employee requires for the
performance of his services.
B. Costs, including tuition, meals, lodging, and transportation incurred
by the Employee to fulfill his duties and responsibilities to the Corporation,
including professional dues, publications, and continuing professional
education.
4.02 EMPLOYEE'S OBLIGATIONS. The Employee agrees that during the term of
this Agreement, he shall:
A. Faithfully and to the best of his ability and skill serve the
Corporation and perform his duties pursuant to this Agreement;
B. Maintain records in the manner established by the Corporation; and
C. Keep current all records, reports, insurance records and clerical work
required by Corporation.
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ARTICLE 5.00 - COVENANTS
5.01 COVENANT NOT TO COMPETE. The Corporation and Employee acknowledge and
confirm that Employee shall not compete with the Corporation while employed or
for a two year period after employment ceases.
5.02 COVENANT FOR PROTECTION OF PROPRIETARY INFORMATION. The parties
hereto recognize that the Corporation and its affiliated corporations and
Employee are desirous of exchanging information during the term of this
Agreement and during the period of the time Employee is affiliated with the
Corporation and its affiliated corporations relating to the research,
development, and marketing of seed, seed products, seed related products and
technology for application in the general field of farming and ranching and that
during the above periods of time, the Corporation and its affiliated
corporations may disclose to the Employee certain information pursuant to this
Agreement which the Corporation and its affiliated corporations deems
proprietary (hereinafter referred to as "Information").
In order to protect the Information, the parties hereto agree that during
the period of Employee's affiliation with the Corporation and its affiliated
corporations, and for a period of two (2) years from the termination date of any
affiliation with the Corporation and its affiliated corporations, Employee shall
not disclose Information it receives or has received from Corporation or its
affiliated corporations that is proprietary in nature, including, but not by way
of limitation, Information marked PROPRIETARY or CONFIDENTIAL or STRICTLY
PRIVATE or INTERNAL DATA, to any other person, firm or corporation, or use it
for its own benefit except as provided herein, and shall use no less stringent
degree of care to void disclosure or use of such Information than Employee
employs with respect to his own proprietary information which it does not wish
to be disseminated, published or disclosed.
The parties hereto agree that Information shall not be deemed proprietary
and Employee shall have no obligation with respect to any such Information
which:
A. Is already known to Employee through lawful channels of communication;
B. Is or becomes publicly known through no wrongful act of Employee;
C. Is rightfully received from a third party without similar restriction
and without breach of this Agreement;
D. Is independently developed by Employee without breach of this
Agreement;
E. Is furnished to a third party by Corporation and its affiliated
corporations without a similar restriction on the third party's rights; or
F. Is approved for release by written authorization of Corporation or its
affiliated corporations. Either party may, without breach of this Agreement,
disclose Information to the government by reason of a governmental requirement
or to a court by reason of operation of law.
Employee shall not be liable for (1) inadvertent disclosure or use of
Information provided that (a) it used not less than the same degree of care in
safeguarding such Information as it used for its own Information of like
importance, and (b) upon discovery of such inadvertent disclosure or use of such
Information, it shall endeavor to prevent any further inadvertent disclosure or
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use, or (2) unauthorized disclosure or use of Information by persons who are or
who have been in its employ, unless it fails to safeguard such Information with
not less than the same degree of care as it uses for its own proprietary
Information of like importance.
In the event Information should be lost, stolen or otherwise compromised,
the party formerly in possession of that Information shall promptly notify the
Corporation by phone, and follow up with a detailed report in writing within ten
(10) days. A coordinated effort shall then be made to recover such Information.
All copies of written data delivered by one party hereto to the other party
pursuant to this Section shall be and remain the property of such one party, and
all such written data, and any copies thereof, shall be promptly returned to
such one party upon written request, or destroyed at such one party's option.
Nothing contained in this Section shall be construed as granting or
conferring any rights by license or otherwise, expressly, implied, or otherwise
for any invention, discovery or improvement made, conceived, or acquired prior
to or after the date of this Agreement.
Employee and Corporation agree that the period set forth herein is
reasonable and further that the period set forth herein does not terminate at
the termination of this Agreement, but shall continue throughout any period of
affiliation, and for a two (2) year period thereafter. This covenant may be
enforced by specific performance or any available legal or equitable remedy,
including, but not by way of limitation, temporary restraining orders or
preliminary and permanent injunctions, and the Corporation and its affiliated
corporations shall be entitled to recover from Employee all court costs and
reasonable attorney's fees incurred in enforcing this covenant. The remedies
hereunder shall not be exclusive of each other, but shall be cumulative.
5.04 DEFINITION OF AFFILIATION. Affiliation, as used in this Article,
shall mean any proprietary, employment or fiduciary relationship of the Employee
with the Corporation and its affiliated corporations, including, but not limited
to, the position of Employee as director, officer, employee or consultant of the
Corporation or its affiliated corporations.
ARTICLE 6.00 - GENERAL MATTER.
6.01 NEVADA LAW. This Agreement shall be governed by the laws of the State
of Nevada and shall be construed in accordance therewith.
6.02 NO WAIVER. No provision of this Agreement may be waived except by an
agreement in writing signed by the waiving party. A waiver of any term or
provision shall not be construed as waiver of any other term or provision.
6.03 BINDING EFFECT. This Agreement shall be binding upon the parties,
their heirs, executors, administrators, successors or assignees. The parties
agree to do any and all things necessary to effectuate the purpose of this
Agreement.
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6.04 CONSTRUCTION. Throughout this Agreement, the singular shall include
the plural; the plural shall include the singular; and the masculine and neuter
shall include the feminine, wherever the context so requires.
6.05 TEXT TO CONTROL. The headings of articles and sections are included
solely for convenience of reference. If any conflict between any heading and
the text of this Agreement exists, the text shall control.
6.06 SEVERABILITY. If any provision of this Agreement is declared by an
court of competent jurisdiction to be invalid for any reason, such invalidity
shall not affect the remaining provisions. On the contrary, such remaining
provisions shall be fully severable, and this Agreement shall be construed and
enforced as if such invalid provisions never had been inserted in this
Agreement.
6.07 AMENDMENT. This Agreement may be amended, altered or revoked at any
time, in whole or in part, by filing with this Agreement a written instrument
setting forth such charges, signed by the Corporation and the Employee.
6.08 NOTICES. All notices required to be given by this Agreement shall be
made in writing either by:
A. Personal delivery to the party requiring notice and securing a written
receipt, or
B. Mailing notice in the U.S. mails to the last known address of the party
requiring notice, which shall be the address shown on the records of the
Corporation for the Employee, by certified mail, return receipt requested.
The effective date of the notice shall be the date of the written receipt
received upon delivery in Paragraph A above or four (4) days after the date the
notice was delivered to the U.S. mail as posted on the receipt in Paragraph B
above.
The parties hereby execute this Employment Agreement on the day and year
first written above.
AGRIBIOTECH, INC.
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, President/CEO
EMPLOYEE:
/s/ Xxxxx X. Xxxx
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Xxxxx X. Xxxx
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