EXHIBIT 10.39
EMPLOYMENT AGREEMENT
THE RICEX COMPANY, a Delaware corporation ("Employer"), and Xxxxxx
X. XxXxxx, Xx. ("Employee"), agree as follows, effective as of the first of
May 1999 (the "Effective Date").
1. EMPLOYMENT. Employer hereby employs Employee and Employee hereby
accepts employment with Employer on the terms and conditions set forth below.
2. POSITION; SCOPE OF EMPLOYMENT. Employee shall have the position
of Executive Vice President and General Manager. Employee's duties shall
include development of primary goals, operating plans, policies, and short
and long range objectives for the Company. Implements these following Board
of Directors' approval. Directs and coordinates activities to achieve profit
and return on capital. Establishes organizational structure and delegates
authority to subordinates. Leads the organization towards objectives, meets
with and advises other executives and reviews results of business operations.
Determines action plans to meet needs of stakeholders. Shall include such
other duties and authority as specified by Employer and as may be modified
from time to time.
2.1. ENTIRE TIME AND EFFORT. Employee shall devote
Employee's full working time, attention, abilities, skill, labor and efforts
to the performance of Employee's employment. Employee shall not directly or
indirectly (i) be substantially engaged in or concerned with any other duties
or pursuits, (ii) render services to any third party for compensation or
other benefit, or (iii) engage in any other business activity that will in
any way interfere with the performance of Employee's duties under this
Agreement, except with the prior written consent of Employer; provided,
however, that Employee may engage in charitable, philanthropic, educational,
religious, civic and similar such activities to the extent that such
activities do not unreasonably interfere with the performance of Employee's
duties under this Agreement.
2.2. RULES AND REGULATIONS. Employee agrees to observe and
comply with Employer's rules and regulations as provided by Employer and as
may be amended from time to time by Employer, and will carry out and
faithfully perform such orders, directions and policies of Employer.
3. TERM OF EMPLOYMENT. Employee's term of employment under the
terms of this Agreement shall commence on May 1, 1999 and shall terminate
five years from that date, unless terminated earlier as provided herein. At
the end of the initial five-year term, this Agreement shall automatically
renew for an additional five-year term unless either party notifies the other
party in writing ninety (90) days prior to the expiration of the term of his
or its intention not to renew this Agreement.
4. COMPENSATION. Employer shall pay Employee the base pay ("Base
Salary") per year which is in effect on the date of this agreement. Effective
six months from the date of this Agreement (November 1, 1999) the Employer
shall pay Employee an effective annual rate equivalent to One Hundred Twenty
Five Thousand Dollars ($125,000) per year. Effective in twelve months of this
Agreement (May 1, 2000), Employer shall pay to Employee an effective
rate equivalent to One Hundred Thirty Five Thousand Dollars ($135,000) per
year. Salary payments will be payable in periodic installments in accordance
with Employer's pay schedule, but not less than twice per month. The Base
Salary shall be reviewed at least annually
4.1. BENEFITS. Employee shall be provided with medical
insurance and such other benefits as provided to Employer's other similarly
situated employees and in accordance with Employer's policies, as modified
from time to time in Employer's sole discretion.
4.2. VACATION AND SICK LEAVE. Employee shall be entitled to
four weeks of vacation each calendar year. Employee's vacation shall accrue
at the rate of thirteen and one-thirds (13 1/3) hours per month but in no
event shall Employee's total accrued vacation exceed eight (8) weeks.
Employee shall be entitled to sick leave in accordance with Employer's sick
leave policy.
4.3. AUTOMOBILE. Employer shall make lease payments on
behalf of the Employee, up to a maximum amount of six hundred dollars
($600.00) per month. Employer shall also reimburse Employee for his actual
expenses incurred in the operation of one automobile for automobile
insurance, annual registration, and maintenance.
4.4. BONUS. Employee shall be eligible to participate in
Employer's bonus program when implemented to the same extent as other
executive employees of Employer. Employer intends to adopt such a program
prior to the expiration of this Agreement, but makes no further
representations as to the terms of such program or the date such program will
be enacted.
4.5. STOCK OR STOCK OPTION PLAN. As additional compensation
for Employee's services, prior to December 31, 1999, Employer shall grant,
and/or shall cause its affiliates, successors, or assigns to grant, to
Employee equity compensation in the form of an option to purchase 900,000
shares of Employer's Common Stock (the "Option") under Employer's 1997 Stock
Option Plan.
5. TERMINATION OF EMPLOYMENT
5.1. TERMINATION EVENTS. Employee's employment shall be
terminated prior to the expiration of this Agreement ("Early Termination")
upon the occurrence of any of the following events: (i) the mutual written
agreement of Employer and Employee; (ii) Employee's disability, which shall
for the purposes of this Agreement mean Employee's inability due to physical
or mental impairment to perform Employee's duties and obligations under this
Agreement, despite reasonable accommodation by Employer, for a period
exceeding three months; (iii) Employee's death; (iv) notice by Employer of
termination for cause as defined in Section 5.2 below; (iv) written notice of
termination by Employer without cause upon fourteen (14) days' notice,
subject to the Compensation Upon Early Termination provisions of Section 5.3
below.
5.2. TERMINATION FOR CAUSE. Employer reserves the right to
terminate this Agreement for cause upon (i) Employee's willful and continued
failure substantially to perform
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his duties and obligations under this Agreement after written demand for
substantial performance has been delivered to Employee by Employer which sets
forth with reasonable specificity the deficiencies in Employee's performance
and giving Employee not less than thirty (30) days to correct such
deficiencies; (ii) fraud or intentional material misrepresentation by
Employee, (iii) unauthorized disclosure or use of Employer's trade secrets or
Confidential Information by Employee; (iv) Employee's conviction of a felony;
(v) theft or conversion of Employer's property by Employee; or (vi)
Employee's habitual misuse of alcohol, illegal narcotics, or other intoxicant.
5.3. COMPENSATION UPON EARLY TERMINATION. Upon early
termination, Employer shall pay Employee compensation as follows.
(A) If Employee is terminated by Employer for
cause, voluntarily resigns, dies, or becomes disabled as such term is used in
Section 5.1 of this Agreement, Employer shall pay Employee, or Employee's
representative, all accrued but unpaid salary and vacation pay accrued
through the effective date of the termination.
(B) If Employee is terminated by Employer without
cause, Employer shall pay to Employee as liquidated damages and in lieu of
any and all other claims which Employee may have against Employer the amount
equal to Employee's monthly base salary multiplied by the number of months
remaining in the term of this Agreement, or payment amount equal to two years
of Employee's Base Salary, which ever is greater. Employer's payment pursuant
to this section shall fully and completely discharge any and all obligations
of Employer to Employee arising out of or related to this Agreement and shall
constitute liquidated damages in lieu of any and all claims which Employee
may have against Employer, not including any obligation under the Worker's
Compensation laws including its Employer's Liability provisions.
(C) If Employee is terminated as the result of a
Change in Control and Employee is not employed in the same capacity or being
paid the same Base Salary by the new entity, then Employee shall receive a
severance payment equal to two years of Employee's Base Salary or the balance
remaining to be paid under the terms of this Agreement, whichever is greater.
In addition, if Employee is terminated as the result of a Change in Control
and Employee is not employed in the same capacity by the new entity, Employer
agrees to continue Employee's medical and dental insurance benefits as
provided during Employee's employment with Employer for a period of two years
from the effective date of the Change in Control, except as provided below in
Section 5.3(C)(1) and Section 5.3(C)(2).
(1) Employee agrees that he shall accept
any plan coverage changes that may occur during the two-year period which
apply to all employees in the workforce.
(2) Employee agrees that he will notify
Employer (or any successor of Employer) if he becomes employed in any
capacity with another employer and becomes eligible to receive medical and
dental insurance benefits through that employment prior to the expiration
date of the two-year period set forth in this section. At such time, Employer
shall no longer be obligated to provide Employee with medical and dental
insurance benefits.
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6. UNFAIR COMPETITION. During Employee's employment under this
Agreement, Employee shall not directly or indirectly, whether as a partner,
employee, creditor, shareholder or otherwise, promote or engage in any
activity or other business which is competitive in any way with Employer's
business, and shall not take any action or make any agreement to establish,
or become employed by, a competing business.
7. PROPRIETARY INFORMATION; CONFIDENTIALITY.
7.1. CONFIDENTIAL INFORMATION. Employee agrees not to
disclose to any others, or take or use for Employee's own purposes or
purposes of any others, during the term of this Agreement, any of Employer's
Confidential Information (as defined below). Employee agrees that these
restrictions shall also apply to (1) Confidential Information belonging to
third parties in Employer's possession and (2) Confidential Information
conceived, originated, discovered or developed by Employee during the term of
this Agreement. "Confidential Information" means any Employer proprietary
information, technical data, trade secrets or know-how, including, but not
limited to, research, product plans, products, services, customer lists and
customers, markets, software, developments, inventions, processes, formulas,
technology, designs, drawings, engineering, marketing, finances or other
business information disclosed to Employee by Employer, either directly or
indirectly, in writing, orally or by drawings, or by observation of products.
Confidential Information does not include any of the foregoing items which
has become publicly known and made generally available through no wrongful
act of Employee. Employee further agrees not to use improperly or disclose or
bring onto the premises of Employer any trade secrets of another person or
entity during the term of this Agreement.
7.2. RETURN OF PROPERTY. Employee agrees that upon
termination of employment with Employer, Employee will deliver to Employer
all devices, records, data, disks, computer files, notes, reports, proposals,
lists, correspondence, specifications, drawings, blueprints, sketches,
materials, equipment, other documents or property, or reproductions of any
aforementioned items developed by Employee pursuant to employment with
Employer or otherwise belonging to Employer, its successors or assigns.
7.3. NONCOMPETITION. Employee shall not use any of the
Confidential Information to compete with Employer in connection with a
business or enterprise of any kind, foreign or domestic, profit or
non-profit, as an investor, partner, shareholder, LLC member, employee,
agent, consultant or independent contractor. Nothing in this Section 7.3
shall be construed to limit the more general prohibitions against
unauthorized use or disclosure of the Confidential Information contained in
other sections of this Agreement.
7.4. NOTIFICATION OF NEW EMPLOYER. Employer shall have the
right to notify any actual or potential future employer of Employee of
Employee's rights and obligations under this Section 7 of the Agreement.
Employee expressly authorizes such disclosure and waives any claims Employee
may have against Employer resulting from the disclosure of Employee's
obligations under this Section 7 to an actual or potential future employer of
Employee.
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7.5. OTHER AGREEMENTS. Employee represents that the
performance of all the terms of this Agreement will not breach any agreement
to keep in confidence proprietary information acquired by Employee in
confidence or in trust prior to employment with Employer. Employee has not
and shall not enter into any oral or written agreement in conflict with this
Agreement.
7.6. EQUITABLE REMEDIES. Employee agrees that it would be
impossible or inadequate to measure and calculate Employer's damages from any
breach of the covenants set forth in this Section 7 of the Agreement.
Accordingly, Employer shall have available, in addition to any other right or
remedy available under law or equity, the right to obtain any injunction from
a court of competent jurisdiction restraining such breach or threatened
breach and to specific performance of any such provision of this Section 7.
Employee further agrees that no bond or other security shall be required in
obtaining such equitable relief and consents to the issuance of such
injunction and to the ordering of specific performance.
8. DISPUTE RESOLUTION. Employee and Employer shall use their best
efforts to settle any disputes regarding the rights or obligations of the
parties under this Agreement through negotiation and agreement. Any disputes
which cannot be settled in this manner shall be conclusively determined by
binding arbitration. The arbitration shall be conducted as follows:
8.1. BINDING ARBITRATION. Any dispute between the parties
shall be submitted to, and conclusively determined by, binding arbitration in
accordance with this Section 8. The provisions of this section shall not
preclude any party from seeking injunctive or other provisional or equitable
relief in order to preserve the status quo of the parties pending resolution
of the dispute, and the filing of an action seeking injunctive or other
provisional relief shall not be construed as a waiver of that party's
arbitration rights. The arbitration of any dispute between the parties to
this Agreement shall be governed by the provisions of the California
Arbitration Act (California Code of Civil Procedure sections 1280, ET SEQ.),
excluding the provisions of Code of Civil Procedure section 1283.05.
8.2. INITIATION OF ARBITRATION. In the case of any dispute
between the parties to this Agreement, either party shall have the right to
initiate the binding arbitration process provided for in this section by
serving upon the other party a demand for arbitration. Notwithstanding any
other provision of law, in order to be enforceable a demand for arbitration
must be served within sixty (60) days of the date on which a party discovers,
or reasonably should have discovered, facts giving rise to a dispute as
defined above.
8.3. SELECTION OF ARBITRATORS. Within thirty (30) days of
service of a demand for arbitration by either party to this Agreement, the
parties shall endeavor in good faith to select a single arbitrator. If they
fail to do so within that time period, each party shall have an additional
period of fifteen (15) days in which to appoint an arbitrator and those
arbitrators within fifteen (15) days shall select an additional arbitrator.
If any party fails to appoint an arbitrator or if the arbitrators initially
selected by the parties fail to appoint an additional arbitrator within the
time specified herein, any party may apply to have an arbitrator appointed
for the party who has failed to appoint, or to have the additional arbitrator
appointed, by the presiding judge for the Superior Court, Sacramento County,
California. If the presiding judge,
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acting in his or her personal capacity, is unable or unwilling to appoint the
additional arbitrator, that arbitrator shall be selected in accordance with
California Code of Civil Procedure section 1281.6.
8.4. LOCATION OF ARBITRATION. Any arbitration hearing shall
be conducted in Sacramento County, California.
8.5. APPLICABLE LAW. The law applicable to the arbitration
of any dispute shall be the law of the State of California, excluding its
conflicts of law rules.
8.6. ARBITRATION PROCEDURES. Except as otherwise provided
in this section, the arbitration shall be governed by the California
Arbitration Act (Code Civ. Proc. SectionsSECTIOns 1280 et seq.), excluding
the provisions of Code of Civil Procedure section 1283.05. In addition,
either party may choose, at that party's discretion, to request that the
arbitrators resolve any dispositive motions prior to the taking of evidence
on the merits of the dispute. By way of example, such dispositive motions
would include, but not be limited to, those which would entitle a party to
summary judgment or summary adjudication of issues pursuant to Code of Civil
Procedure section 437c or resolution of a special defense as provided for at
Code of Civil Procedure section 597. In the event that a party to the
arbitration requests that the arbitrators resolve a dispositive motion, the
arbitrators shall receive and consider any written or oral arguments
regarding the dispositive motion, and shall receive and consider any evidence
specifically relating thereto, and shall render a decision thereon, before
hearing any evidence on the merits of the dispute.
8.7. LIMITATION ON SCOPE OF ARBITRATORS' AWARD OR DECISION.
Employer and Employee agree that if the arbitrators find any disputed claim
to be meritorious, the arbitrators shall have the authority to order legal
and/or equitable relief appropriate to the claim, but that in no event shall
the arbitrators have authority to award punitive or exemplary damages.
8.8. COSTS OF ARBITRATION; ATTORNEYS' FEES. Each party
shall bear equally the costs of the arbitration and shall bear its own
attorneys' fees. However, Employer and Employee agree that the arbitrators,
in their discretion, may award to the prevailing party the costs, including
the costs of the arbitration, and attorneys' fees incurred by that party in
participating in the arbitration process.
8.9. ACKNOWLEDGMENT OF CONSENT TO ARBITRATION. NOTICE: BY
INITIALING IN THE SPACE BELOW, YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING
OUT OF THE MATTERS INCLUDED IN THIS "DISPUTE RESOLUTION" SECTION DECIDED BY
NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP ANY
RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY
TRIAL. BY INITIALING IN THE SPACE BELOW, YOU ARE GIVING UP YOUR JUDICIAL
RIGHTS TO DISCOVERY AND APPEAL UNLESS SUCH RIGHTS ARE SPECIFICALLY INCLUDED
IN THIS "DISPUTE RESOLUTION" SECTION. IF YOU REFUSE TO SUBMIT TO ARBITRATION
AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED TO ARBITRATE UNDER THE
AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE. YOUR AGREEMENT TO THIS
ARBITRATION PROVISION IS VOLUNTARY.
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WE HAVE READ AND UNDERSTOOD THE FOREGOING AND AGREE TO SUBMIT DISPUTES
ARISING OUT OF THE MATTERS INCLUDED IN THIS DISPUTE RESOLUTION PROVISION TO
NEUTRAL ARBITRATION.
INITIALS OF EMPLOYER'S AUTHORIZED REPRESENTATIVE
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INITIALS OF EMPLOYEE
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9. MISCELLANEOUS.
9.1. NOTICES. Any notice under this Agreement shall be in
writing, and any written notice or other document shall be deemed to have
been duly given (i) on the date of personal service on the parties, (ii) on
the third business day after mailing, if the document is mailed by registered
or certified mail, (iii) one day after being sent by professional or
overnight courier or messenger service guaranteeing one-day delivery, with
receipt confirmed by the courier, or (iv) on the date of transmission if sent
by telegram, telex, telecopy or other means of electronic transmission
resulting in written copies, with receipt confirmed. Any such notice shall be
delivered or addressed to the parties at the addresses set forth below or at
the most recent address specified by the addressee through written notice
under this provision. Failure to give notice in accordance with any of the
foregoing methods shall not defeat the effectiveness of notice actually
received by the addressee.
9.2. FEES; PREJUDGMENT INTEREST. If the services of an
attorney are required by any party to secure the performance hereof or
otherwise upon the breach or default of another party to this Agreement, or
if any judicial remedy is necessary to enforce or interpret any provision of
this Agreement or the rights and duties of any person in relation thereto,
the prevailing party shall be entitled to reasonable attorneys' fees, costs
and other expenses, in addition to any other relief to which such party may
be entitled. Any award of damages following judicial remedy or arbitration as
a result of the breach of this Agreement or any of its provisions shall
include an award of prejudgment interest from the date of the breach at the
maximum amount of interest allowed by law.
9.3. CHOICE OF LAW, JURISDICTION, VENUE. This Agreement is
drawn to be effective in the State of California, and shall be construed in
accordance with California law. The exclusive jurisdiction and venue of any
legal action by either party under this Agreement shall be the County of
Sacramento, California.
9.4. AMENDMENT. The provisions of this Agreement may be
modified at any time by agreement of the parties. Any such agreement
hereafter made shall be ineffective to modify this Agreement in any respect
unless in writing and signed by the parties against whom enforcement of the
modification or discharge is sought.
9.5. WAIVER. Any of the terms or conditions of this
Agreement may be waived at any time by the party entitled to the benefit
thereof, but no such waiver shall affect or impair
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the right of the waiving party to require observance, performance or
satisfaction either of that term or condition as it applies on a subsequent
occasion or of any other term or condition.
9.6. ASSIGNMENT. The parties agree that Employee's rights
and obligations under this Agreement are personal and not assignable. This
Agreement contains the entire agreement between the parties to it and shall
be binding on and inure to the benefit of the heirs, personal
representatives, successors and assigns of Employer.
9.7. INDEPENDENT COVENANTS. All provisions herein concerning
unfair competition and confidentiality shall be deemed independent covenants
and shall be enforceable without regard to any breach by Employer unless such
breach by Employer is willful and reckless.
9.8. ENTIRE AGREEMENT. This document constitutes the entire
agreement between the parties, all oral agreements being merged herein, and
supersedes all prior representations and written agreements. There are no
representations, agreements, arrangements, or understandings, oral or
written, between or among the parties relating to the subject matter of this
Agreement that are not fully expressed herein.
9.9. SEVERABILITY. If any provision of this Agreement is
held by a court of competent jurisdiction to be invalid or unenforceable, the
remainder of the Agreement which can be given effect without the invalid
provision shall continue in full force and effect and shall in no way be
impaired or invalidated.
9.10. CAPTIONS. All paragraph captions are for reference
only and shall not be considered in construing this Agreement.
DATED: May 3, 1999
THE RICEX COMPANY EMPLOYEE
By:
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Xxxxxx X. XxXxxx Xxxxxx X. XxXxxx, Xx.
Its: Chief Executive Officer Address:
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EXHIBIT 10.39
SCHEDULE TO IDENTICAL DOCUMENTS FILED
Xxxx X. Xxxx
Xxx Xxxxx
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