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EXHIBIT 10.2
EMPLOYMENT AGREEMENT
CHIEF EXECUTIVE OFFICER
This Employment Agreement ("Agreement") is made effective the
1st day of December, 2008, by and between Otter Tail Ag
Enterprises, LLC , a Minnesota limited liability company
("Company"), and Anthony J. Hicks , a Minnesota resident
("Executive").
RECITALS
WHEREAS, Company is a limited liability company organized for
the purpose, among other things, of operating an ethanol plant and
associated business, with its principal place of business near
Fergus Falls, Minnesota; and
WHEREAS, Executive is employed by Company as the Chief Financial
Officer and the Chief Executive Officer, having been appointed to
such positions by the Company’s Board of Governors, and
Company seeks to retain Executive as Chief Executive Officer/Chief
Financial Officer under the terms of this Agreement; and
WHEREAS, the Company and Executive believe it is in their mutual
best interests to enter into an agreement regarding their mutual
obligations relative to Executive’s employment with the
Company.
NOW, THEREFORE, the parties hereto agree as follows:
1.
EMPLOYMENT.
Company agrees to continue to employ Executive as its Chief
Financial Officer and its Chief Executive Officer/General Manager,
under the terms of this Agreement commencing on December 1,
2008 (the "Start Date"). The positions shall be referred to
as "Chief Financial Officer" and "Chief Executive Officer".
Executive hereby accepts such continued employment commencing
on the Start Date, and agrees to remain employed with the Company
in accordance with the terms and conditions of this Agreement and
the terms of employment applicable to regular employees of Company,
including the terms and conditions to be set forth in the
Company’s Human Resources Policy Manual to be developed by
the Company (the "Handbook"). In the event of any conflict or
ambiguity between the terms of this Agreement and terms of
employment applicable to regular employees, the terms of this
Agreement shall control. Any prior agreements or
arrangements concerning Hick’s employment with the Company,
oral or written, between Executive and Hicks are superseded and
replaced by the terms of this Agreement.
2.
DUTIES OF EXECUTIVE.
The duties of Executive shall include the performance of all of
the duties typical of the office held by Chief Executive Officer
and Chief Financial Officer of an ethanol plant as described in the
organizational documents of the Company, described in the job
description of Chief Executive Officer and Chief Financial Officer,
as the case may be, and such other duties and obligations as may be
assigned or directed by the Company’s Board of Governors
(the
"Board"). Executive shall perform all his duties in a
professional, ethical and businesslike manner.
Executive agrees to serve the Company faithfully and to the best
of his abilities, and to devote his full time, attention, and
efforts to the business and affairs of the Company during the term
of his employment with the Company. Executive will not,
during the term of this Agreement or his employment with the
Company, directly or indirectly engage in any other part time or
full time employment or business, either as an employee, employer,
consultant, principal, officer, director, advisor, or in any other
capacity, either with or without compensation, without the prior
written consent of the Board. Executive represents to the
Company that he is under no contractual commitments that are
inconsistent with his obligations set forth in this Agreement or
that would preclude his employment with the Company.
3.
COMPENSATION .
Executive’s salary during the term of his employment with
the Company under this Agreement will be payable in installments
according to the Company’s regular payroll schedule.
Executive’s base annualized salary during the term of this
Agreement shall be as follows ( the "Base Salary"):
Start Date – December 31, 2009: $137,000.00
Executive shall have the opportunity to earn a discretionary
bonus which shall be considered by the Board in November, 2009,
depending on the fiscal condition of the Company. Provided
Executive meets the standard requirements of qualifying to be a
member of the Company, Executive will receive a profit’s
interest on a total of an additional 10,000 Class A member
units of the Company at a zero basis, with ownership of said units
to vest as follows (the "Vesting Dates"):
January 1, 2009- 4,500 Units Vest
December 31, 2009– 4,500 Units Vest
December 31, 2010 – 1,000 Units Vest
Vesting is contingent upon Executive being employed with the
Company on any of the Vesting Dates. A precondition of any
Compensation to be paid under this Agreement is Executive’s
performance of his duties, compliance with this Agreement, and
compliance with the regulations governing plant operations.
4.
BENEFITS.
In addition to the compensation described in Section 3 of
this Agreement, Executive will be entitled to certain additional
benefits afforded to the Chief Executive Officer position, as well
as those benefits generally available to employees of the
Company. Benefits afforded are generally subject to being
altered, modified, discontinued, amended, or otherwise changed by
the Company.
A.
Vacation/Sick Leave . Executive will be entitled to
paid time off and extended illness bank benefits or vacation/sick
leave benefits as set forth in the Handbook.
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B.
Health and Hospitalization Insurance . Executive shall
be afforded health and hospitalization insurance coverage pursuant
to the Company’s plans afforded other employees, with the
Company paying health and hospitalization insurance premiums for
Executive’s individual coverage.
C.
Other Benefits . Executive shall also be afforded the
right to participate in any other benefit plans now or later
available to other Company employees.
D.
401K . Executive shall be entitled to participate in
Company’s 401K savings plan, on the basis of the same
availability to other Company employees.
E.
Automobile . Company has leased a motor vehicle for
company use. The vehicle will be used for administrative purposes
by Executive and other Company employees primarily, but may be used
by Executive for personal use. A mileage log shall be kept by
Executive noting all business use and personal use miles, and this
log shall be utilized to do a personal value calculation to be
reflected on Executive’s W-2 form each year.
F.
Expense Reimbursement . Executive shall be
entitled to reimbursement for all reasonable expenses, including
travel and entertainment, incurred by Executive in the performance
of Executive’s duties pursuant to policies adopted by the
Board. Executive will maintain records and written receipt as
required by the Company policy and reasonably requested by the
board of directors to substantiate such expenses.
G.
Miscellaneous . Company will provide Executive with a
cellular phone and service plan, personal computer, PDA, and such
other equipment and tools as are reasonably necessary for Executive
to perform Executive’s duties. Company shall reimburse
Executive or pay dues or fees incurred by Executive in ethanol
industry related programs, organizations, and education programs as
the Company may, from time to time, authorize Executive to
participate in. Executive is authorized and directed to
involve himself in and participate in the activities of such
organizations related to the ethanol industry as Executive, in his
reasonable discretion, and such other organizations related to the
ethanol industry as Executive, in his reasonable discretion, deems
appropriate and necessary, and such activities shall be regarded as
part of Executive’s duties as Chief Executive Officer and
Chief Financial Officer.
5.
TERM AND TERMINATION.
A.
Term . The term of Executive’s employment with the
Company pursuant to this Agreement shall commence on the Start
Date, and it shall continue in effect for a period terminating on
December 31, 2009 (the "Termination Date"), unless earlier
terminated as provided in this Agreement. On the Termination
Date, this Agreement and Executive’s employment with the
Company shall terminate without any further action, but may be
renewed or extended upon the mutual written agreement of Executive
and Company. In the sixty (60) day period preceding the
Termination Date, or e
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