EXHIBIT 10.36
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made effective as of May 1, 1999 by and between Michael
Bergeland (hereinafter "Bergeland") and Cenex Harvest States Cooperatives, a
Minnesota cooperative corporation (together with all affiliates, the "Company").
1. The Employment Clause
The Company hereby agrees to and does hereby employ Bergeland as Executive
Vice President and Bergeland hereby agrees to continue in the employ of the
Company as Executive Vice President for the period set forth in Paragraph 2
below (the period of employment) upon the other terms and conditions set
forth in this Agreement. It is also agreed for the period of this
agreement, Bergeland shall be afforded the same professional privileges
generally afforded Executive Vice Presidents of the Company which include
but are not limited to attendance at meetings, business trips, and
continuation of membership on boards such as the Grain Exchange, United
Harvest and the Company Retirement Plans.
Bergeland shall also be afforded the same consideration for retention
and/or success incentives as other Executive Vice President's of the
Company should such incentives become operative through any merger,
acquisition, or change in control.
2. Period of Employment; Termination of Agreement
The period of employment shall commence on the date of this Agreement and,
subject only to the provisions of Paragraphs 6(b) and 6(c) below, relating,
respectively, to death and disability, shall continue through August 31,
2001, provided that Bergeland's employment may be terminated by either
party on at least thirty (30) days written notice, subject to the rights
and obligations of the parties set forth herein.
3. The Performance Clause
Throughout the period of employment, Bergeland agrees to devote his full
time and attention during normal business hours to the business of the
Company, except for earned vacation and except for illness or incapacity.
4. The Compensation Clause
a. For all services to be rendered by Bergeland in any capacity during
the period of employment, Bergeland shall be paid as annual
compensation a base or fixed salary of $300,000. The President &
General Manager will annually review Bergeland's annual compensation
and determine what is appropriate for a cost of living, merit
increase, and/or increase in responsibilities or duties.
b. Bergeland shall be entitled to receive incentive compensation based on
the Executive Compensation Plan of the Company. It is agreed Bergeland
shall receive the maximum payout as provided in the terms of the
annual variable pay plan of the Company for the years 1999, 2000 and
2001.
c. During the term of his employment hereunder, Bergeland shall be
entitled to retain the automobile Bergeland presently uses and shall
be covered by all provisions of the automobile policy in effect at the
time of this Agreement.
d. During the term of Bergeland's employment herunder, Bergeland shall be
entitled to those employee benefits separately made available to him
from time to time by the Company in its discretion, including
financial planning, club memberships, executive physicals and
executive disability programs.
e. The Company shall bear such ordinary and necessary business expenses
incurred by Bergeland in performing his duties herunder as the Company
determines from time to time, provided that Bergeland accounts
promptly for such expenses to the Company in the manner prescribed
from time to time by the Company.
5. Termination with Severance Allowance
a) Terms of Severance Allowance and Amount. At the expiration of this
Agreement, Bergeland shall be provided a severance allowance made up
of the following components:
i) Bergeland shall receive a lump sum payment for the Company's
long-term variable pay plan equal to his target payout from that
plan.
ii) Bergeland and the Company are party to the "1997 Supplemental
Executive Retirement Plan (SERP) Agreement" executed by Bergeland
on May 30, 1997 and the Company on May 27, 1997. The schedule of
SERP balance outlined in that agreement shall be accelerated by 5
years and 4 months so that Bergeland is eligible for the maximum
amount provided for pursuant that schedule and shall be eligible
to receive that amount effective September 1, 2001.
iii) Medical, dental, vision and hearing insurance shall be provided
to Bergeland on the same basis as other eligible retirees of the
Company.
iv) Ownership in the equity portion of Bergeland's membership at
Midland Hills Golf Club shall be maintained by Bergeland.
b) Terms and Conditions for Early Severance Allowance and Amount. In the
event of termination of the employment of Bergeland by the Company
during the period of employment for any reason other than for cause,
as defined in (b) below, death or disability, the Company shall pay
Bergeland a severance allowance by continuing Bergeland's base or
fixed salary through August 31, 2001. In addition, Bergeland shall
receive a pro rata benefit from variable pay plans of the employer in
effect at the time this Agreement is effective. Bergeland shall also
receive benefits described in 5(a)(ii-iv) above. Said severance
allowance shall be in lieu of all other severance payable to Bergeland
under Company severance policies. Said severance shall be paid in
semi-monthly installments, subject to normal withholding taxes.
c) Definition of "For Cause". For the purpose of this Agreement,
termination of Bergeland's employment shall be deemed to have been for
cause (and in which case the Company shall have no obligation to
Bergeland whatsoever) only:
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i) If termination of Bergeland's employment shall have been the
result of an act or acts of fraud, theft or embezzlement on the
part of Bergeland which, if convicted, would constitute a felony
and which results or which is intended to result directly or
indirectly in gain or personal enrichment of Bergeland at the
expense of the Company; or
ii) If termination of Bergeland's employment results from Bergeland's
willful and material misconduct, including willful and material
failure to perform his duties, and Bergeland has been given
written notice by the Company with respect to such and Bergeland
does not cure within a reasonable time; or
iii) If there has been a breach by Bergeland during the period of
employment of the provisions of Paragraph 3 above, relating to
the time to be devoted to the affairs of the Company, and with
respect to any alleged breach of Paragraph 3 hereof, Bergeland
shall have substantially failed to remedy such alleged breach
within thirty days from Bergeland's receipt of notice from the
Company.
d) Request and Release. In order to obtain the severance allowance
provided for in this Agreement, Bergeland must submit a request for
severance and must sign a complete release of all claims. The Company
shall have no obligation to pay any severance allowance unless and
until Bergeland shall have submitted the request for severance and
signed a full and complete release of all claims, to be drafted by
Legal Counsel for the Company.
6. Termination without Severance Allowance
a. Voluntary Termination by Bergeland. In the event of voluntary
termination by Bergeland, the Company shall not owe Bergeland any
severance allowance and Bergeland shall not, for a period of three (3)
years from the date of termination, directly or indirectly participate
anywhere in the continental United Sates in any activities which are
in competition or conflict with the activities of the Company or any
Company subsidiary of affiliate, including, but not limited to,
managing, consulting, operating, controlling, owning or having an
ownership interest in, being employed by, or being connected with the
management, operation or control of, any business which is of the same
or similar type of business in which the Company or any Company
subsidiary or affiliate presently engage, or hereafter engage during
the term of this Agreement, or which competes with, or reasonably
could be expected to compete with, the Company or any Company
subsidiary or affiliate. Notwithstanding any provision herein,
Bergeland shall be entitled to receive, to the date of termination,
base or fixed compensation plus a prorated amount of Executive
Compensation.
b. Death. In the event of Bergeland's death during the period of
employment, the legal representative of Bergeland shall be entitled to
the base or fixed salary provided for in Paragraph (4)a above for the
month in which death shall have occurred, at the rate being paid at
the time of death, and the period of employment shall be deemed to
have ended as of the close of business on the last day of the month in
which death shall have occurred but without prejudice to any benefits,
such as life insurance, otherwise due in respect to Bergeland's death.
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c. Disability
i) In the event of Bergeland's disability during the period of
employment, Bergeland shall be entitled to an amount equal to the
base or fixed salary provided for in Paragraph 4(a) above, at the
rate being paid at the time of the commencement of disability,
for the period of such disability but not in excess of twelve
(12) months from the beginning of the period that establishes
such disability, as described in Paragraph 6(c)(iii) below.
ii) The amount of any payments under Paragraph 6 (c)(i) shall be
reduced by any payments to which Bergeland may be entitled for
the same period because of disability under any disability or
pension plan of Cenex Harvest States or of any division,
subsidiary, or affiliate thereof, or as the result of worker's
compensation or nonoccupational disability payments received from
any government entity.
iii) The term "Disability" as used in this Agreement, shall mean an
illness or accident occurring during the period of employment
which prevents Bergeland from performing the essential functions
of his job under the Agreement, with reasonable accommodations
(as defined by federal and Minnesota disability laws), for a
period of six consecutive months. The period of employment shall
be deemed to have ended as of the close of business on the last
day of such six-month period but without prejudice to any
payments due Bergeland from any disability policy or disability
insurance.
7. Successor in Interest
This Agreement and the rights and obligations hereunder shall be binding
upon and inure to the benefit of the parties hereto and their respective
legal representatives, and shall also bind and inure to the benefit of any
successor of the Company by merger or consolidation or any purchaser or
assignee of all or substantially all of its assets, but, except to any such
successor, purchaser, or assignee of the Company, neither this Agreement
nor any rights or benefits hereunder may be assigned by either party
hereto.
8. Construction
Whenever possible, each provision of this Agreement shall be interpreted in
such a manner as to be effective and valid under applicable law, but if any
provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective only to the extent of
such prohibition or invalidity without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
9. Governing Laws
This Agreement shall be governed by an construed and enforced in accordance
with the laws of the State of Minnesota.
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10. Notices
Any notice required or permitted to be given under this Agreement shall be
sufficient if in writing, sent by Certified Mail, Return Receipt Requested:
If to Bergeland: Michael Bergeland
853 Amble Road
Shoreview, MN 55126
If to the Company: John D. Johnson
Cenex Harvest States Cooperatives
P. O. Box 64089
St. Paul, MN 55164-0089
With a copy to: Richard L. Baldwin, Human Resources
Cenex Harvest States Cooperatives
P. O. Box 64089
St. Paul, MN 55164-0089
11. Entire Agreement
This Agreement shall constitute the entire agreement between the parties,
superseding all prior agreements, and may not be modified or amended and no
waiver shall be effective unless by written document signed by the
President and General Manager and Bergeland.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date set forth above.
CENEX HARVEST STATES COOPERATIVES
_________________________ By: _______________________________
Michael Bergeland John D. Johnson
President & General Manager