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Sample Business Contracts

Employment Agreement - Poore Brothers Inc. and John M. Silvestri

Employment Forms

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  • Executive Employment Agreement. Companies may offer their business executives a contract that is different from the one provided to their regular employees. Executive employment agreements may be more complex because the compensation structure may include a combination of salary and commissions, provide for bonuses based on sales, stock or other financial targets, and include non-compete, confidentiality and severance provisions.
  • Sales Representative Contract. Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
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                              EMPLOYMENT AGREEMENT

     This employment agreement  ("Agreement") is made and entered into effective
as of the 31st day of August 2000  ("Effective  Dates"),  by and  between  POORE
BROTHERS,  INC.  ("Company"),  a  Delaware  corporation,  and JOHN M.  SILVESTRI
("Employee"), a married man.

     In consideration of the mutual promises and covenants contained herein, and
other good and  valuable  consideration,  the receipt of which is  acknowledged,
Company and Employee agree as provided in this Agreement.

     1.  EMPLOYMENT.  Company  hereby  employs  Employee,  and Employee  accepts
employment  by  Company,  upon  the  terms  and  conditions  contained  in  this
Agreement.

     2. TERM.  Employee's  employment  by Company  shall  commence on August 31,
2000,  and shall  continue  until either  Company or Employee gives to the other
party written notice of  termination.  Employee shall be an employee at will and
if Employee's employment is terminated,  Employee's status as officer of Company
shall also be terminated.  Either  Company or Employee may terminate  Employee's
employment by Company with or without cause upon written  notice of  termination
to the other party.

     3. TITLE. During the period of Employee's  employment by Company,  Employee
shall be the Senior Vice  President  of Sales &  Marketing  of Company and shall
have all rights,  powers and  authority  inherent in such  position,  including,
without  limitation,  the authority to direct the day-to-day sales operations of
Company,  as may be designated by the Company's  Board of Directors from time to
time.

     4.  COMPENSATION.  During the period of  Employee's  employment by Company,
Employee shall receive from Company an annual salary of $157,200, which shall be
payable  proportionately  on Company's  regular  payroll  payment  dates for its
employees. Employee's annual salary shall be subject to change at the discretion
of Company's Compensation Committee of the Board of Directors.

     5. BONUSES.  During and for the period of Employee's employment by Company,
Employee shall receive such bonuses,  whether incentive,  merit or otherwise and
whether cash,  stock or otherwise,  as Company's  Compensation  Committee  shall
determine from time to time.

     6. FRINGE BENEFITS.  During the period of Employee's employment by Company,
Employee  shall  be  entitled  to  participate  in  all of  Company's  qualified
retirement plans and welfare benefit plans (e.g., group health insurance) on the
same basis as  Company's  other  employees.  In  addition,  during the period of
Employee's  employment by Company,  Employee shall be entitled to participate in
all  non-qualified  deferred  compensation and similar  compensation,  bonus and
stock plans offered,  sponsored or established by Company on  substantially  the
same basis as any other employee of Company.

     Employee shall be entitled to four (4) weeks vacation (prorated for partial
calendar years) during each year of his employment with Company.

     7. TELEPHONE,  CREDIT CARD AND ALLOWANCES.  During the period of Employee's
employment by Company, Company shall furnish to Employee the following:

          (a) Company shall  furnish to Employee a mobile or cellular  telephone
for  Employee's  use and shall pay all charges in connection  therewith  (except
Employee shall  reimburse  Company for the charges each month that are in excess
of $200 of charges in such month  which are not  accounted  for by  Employee  as
charges for the purposes of Company).  The telephone to be furnished to Employee
shall be agreed upon by Company and Employee from time to time.

          (b)  Company  shall  furnish  to  Employee a Company  credit  card for
Employee to use solely for purposes of Company.

          (c) Company  shall pay  Employee an  automobile  allowance of $650 per
month.  In no event shall  Company be  responsible  for any  automobile  related
expenses,  including but not limited to gasoline,  insurance  (however  Employee
shall maintain  insurance  coverage  reasonably  satisfactory to Company),  oil,
tires,  warranty and routine  service and other  maintenance and repairs for the

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automobile.  Employee  acknowledges  that he may  recognize  taxable  income  in
connection with Company's providing an auto allowance.

          (d) Company shall also pay to Employee a  $105,900.00  non-accountable
expense allowance, before taxes, to defray Employee's reasonable costs of moving
and  relocation.  This allowance shall be paid within three (3) business days of
the Effective Date if Employee  commences  employment  with Company in Goodyear,
Arizona on or before said date;  provided,  that if this Agreement is terminated
by Employee  prior to Employee's  completion of twelve (12) months of employment
or Employee's  immediate  family fails to move  permanently to Arizona within 90
days of the Effective  Date,  Employee  shall repay to Company  within three (3)
months the $105,900.00 allowance paid by Company.  Employee acknowledges that he
may  recognize   taxable  income  in  connection  with  Company's   providing  a
non-accountable expense allowance.

     8. OPTIONS.

     Company hereby grants to Employee the right and option to purchase  100,000
shares of Company's  $0.01 par value voting common stock  ("Common  Stock"),  in
accordance  with Company's  1995 Stock Option Plan ("ISO Plan"),  at a price per
share equal to the average  closing  price ("last  sale") per share of Company's
Common  Stock for the five (5)  consecutive  day  trading  period  ending on the
Effective  Date.  These options will vest in equal 33,333  (33,334 shares in the
final year) share increments on the first, second and third anniversaries of the
Effective  Date.  Employee  acknowledges  receipt  of a copy of the ISO Plan and
agrees to the terms set forth therein.  Employee further recognizes that the ISO
Plan is  subject  to  change  from  time to time by the  Board of  Directors  of
Company.  All of the terms and conditions of the options  described herein shall
otherwise  be  governed  by  the  terms  of  the  ISO  Plan  including,  without
limitation, exercise dates and times, payment of option prices, revisions of the
options,  expiration  and the like, all of the terms and conditions of which ISO
Plan are  incorporated  by reference  into this portion of this  Agreement as if
fully rewritten herein.

     Company hereby grants to Employee the right and option to purchase  100,000
shares of Company's  Common Stock,  in accordance  with Company's  Non-statutory
Stock Options ("NSO  Plan"),  at a price per share equal to the average  closing
price  ("last  sale")  per  share of  Company's  Common  Stock  for the five (5)
consecutive day trading period ending on the Effective Date.  These options will
vest in equal 33,333 (33,334  shares in the final year) share  increments on the
first,   second  and  third   anniversaries  of  the  Effective  Date.  Employee
acknowledges receipt of a copy of the NSO Plan and agrees to the terms set forth
therein. Employee further recognizes that the NSO Plan is subject to change from
time to time  by the  Board  of  Directors  of  Company.  All of the  terms  and
conditions of the options  described  herein shall  otherwise be governed by the
terms of the NSO Plan including,  without limitation,  exercise dates and times,
payment of option prices, revisions of the options, expiration and the like, all
of the terms and conditions of which NSO Plan are incorporated by reference into
this portion of this Agreement as if fully rewritten herein.

     Nothwithstanding the foregoing, any unvested portion of the options granted
to Employee  hereunder shall become  exercisable  upon a "change in control" (as
defined  below) of  Company.  As used in this  paragraph,  the term  "change  of
control" shall mean the change of hands,  within any  consecutive  one (1) month
period,  of more than thirty (30) percent of the voting  stock of Company,  with
the concomitant result that the new owner or owners of such stock exercise their
voting rights to "control" the identities of the members of the Company's  Board
of Directors,  as the term "control" is defined,  or to which reference is made,
in the  regulations  promulgated  under the Securities  Exchange Act of 1934, as
amended.

     9. CONFIDENTIALITY.

          (a) During the period of  Employee's  employment  by Company and for a
one year period  thereafter,  Employee  shall hold in  confidence  and shall not
disclose  or  publish,  except  in the  performance  of his  duties  under  this
Agreement,  any Confidential Information (as defined below) that is presented or
disclosed to him in connection with his employment by Company.

          (b) Subject to the  provisions of Section 9(c) below,  for purposes of
this Agreement the term  "Confidential  Information"  shall mean  information or
material  that  is  proprietary  to and  owned  by  Company.  Such  Confidential
Information shall include,  without limitation,  Company's recipes for specialty
potato  chips,  manufacturing  processes,  customer  lists,  supplier  lists and
pricing information.

          (c) Notwithstanding the foregoing,  the term Confidential  Information
shall not include any information or material that:

               (i) is in, or has passed into, the public domain;

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               (ii) is lawfully received by Employee from a third party;

               (iii) is required to be  disclosed by Employee by law or pursuant
          to an order determination  issued by a court or any federal,  state or
          municipal regulatory or administrative agency; or

               (iv) was in the possession of, or known by, Employee prior to his
          Employment by Company.

          (d) Employee acknowledges that the Confidential Information of Company
is unique in character and that Company would not have an adequate remedy at law
for a material breach or threatened material breach by Employee of his covenants
under this Section 9. Employee  therefore  agrees that, in the event of any such
material  breach  or threat  thereof,  Company  may  obtain a  temporary  and/or
permanent  injunction or restraining order to enjoin Employee from such material
breach or threat thereof,  in addition to any other rights or remedies available
to Company at law or in equity.

          (e) Notwithstanding the foregoing,  Employee may disclose Confidential
Information to his attorneys and other advisors on a need to know basis provided
the  recipient is directed and required to maintain the  disclosed  Confidential
Information in confidence.

     10.  NONCOMPETE.  During the period of  Employee's  employment  by Company,
Employee shall not,  directly or indirectly,  whether as principal,  consultant,
employee, agent, officer, director, trustee or otherwise, engage in the business
of manufacturing specialty potato chips, salted snack foods or popcorn or engage
in the business of selling or distributing  specialty potato chips, salted snack
foods or popcorn.  In  addition,  Employee  shall not,  for a period of one year
beginning on the date of termination of his employment,  directly or indirectly,
whether as principal, consultant, employee, agent, officer, director, trustee or
otherwise,  engage  in the  United  States  in  the  business  of  manufacturing
specialty  potato  chips,  salted snack foods or popcorn or engage in the United
States in the business of selling or distributing specialty potato chips, salted
snack foods or popcorn. Employee acknowledges that the foregoing limitations are
minimum  limitations which are necessary to protect the legitimate  interests of
Company  because  of  Employee's  sensitive  executive  position  with  Company.
Therefore,  if a breach of the foregoing  shall occur, in addition to any action
for damages  which  Company may have,  Company shall have the right to obtain an
injunction as a matter of right prohibiting  Employee's competition in violation
of the foregoing. In the event that the time period of non-competition is deemed
to be  unreasonable,  Employee  acknowledges  that 11  months  shall  be  deemed
reasonable.  In the event 11 months  is deemed  unreasonable,  then 10 months is
deemed reasonable, and so on, until the foregoing covenant is enforceable to the
fullest  extent  permitted  by law.  Similarly,  in the event the entire  United
States is deemed  unreasonable,  states shall be eliminated one by one beginning
with Maine,  continuing  down the east coast of the United States and in roughly
in north to south linear fashion across the United States until the geographical
limit set forth above is deemed  reasonable to the fullest  extent  permitted by
law.

     11.  SEVERANCE.  Although  Employee is an employee at will,  and Employee's
status as employee and officer of Company may be  terminated at any time for any
reason or for no reason at all,  Company  agrees that, if Employee is terminated
by  Company  (as  opposed  to  Employee  resigning)  without  "cause"  (to which
reference  is made  below),  Employee  shall be entitled to receive four months'
salary ("Severance Compensation"), which Severance Compensation shall be paid as
regular  compensation would be paid over said four-month period after Employee's
employment  is  terminated.  Employee  shall  further be  entitled to retain all
vested  options and Employer  shall pay  reasonable  (in  Employer's  reasonable
determination)  out-placement fees not to exceed $5,000.00 regarding  Employee's
future  employment  during the  four-month  period  following  the  termination.
Employee's  right to receive such  Severance  Compensation  shall be conditioned
upon Employee  executing such documents  (including  reasonable  mutual releases
which also must be executed by Employee's  spouse,  if any) in such forms as may
be prescribed by Company from time to time.

     Employee acknowledges if Employee's employment is terminated by Company for
"cause,"  Employee  shall  be due no  Severance  Compensation  or  out-placement
assistance  and may  further  be liable to  Company  for  damages  caused by the
existence of such cause, to the extent permitted by law and this Agreement. When
used herein, the term "cause" shall mean and refer to any of the following:

          (i)  Employee's continued insubordination or failure to follow Company
               directives after notice from Company or its Board;

          (ii) Employee  conducting  himself in a manner which is not reasonably
               calculated to be in the best interests of Company or which brings
               disrepute or disdain upon Company  and/or its  reputation  and/or
               products,  after Employee has received notice from Company or the
               Board  of such  conduct  and has  continued  to  persist  in such
               conduct;

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         (iii) Any acts of gross negligence,  willful malfeasance,  theft, fraud
               or  dishonesty  of Employee or the  bankruptcy  or  insolvency of
               Employee;

          (iv) The death or disability of Employee,  Employee acknowledging that
               such events are covered by Company's general benefit package; or

          (v)  Employee's  breach of any  other  term of this  Agreement,  which
               breach persists after ten (10) days written notice to Employee of
               such breach.

     12. INDEMNIFICATION.

          (a) Company  shall  indemnify  and hold  Employee  harmless and defend
Employee  for,  from and against all claims,  liabilities,  obligations,  fines,
penalties  and other  matters and all costs and expenses  relating  thereto that
Company and/or such  subsidiary or affiliated  entity is permitted by applicable
law,  except as any of the  foregoing  arises out of or  relates  to  Employee's
negligence, willful malfeasance and/or breach of this Agreement.

          (b)  Company  represents  and  warrant to  Employee  that  neither its
articles of incorporation nor its bylaws nor any resolutions of its shareholders
or board of directors  restricts or limits  Companies  rights or  obligations to
indemnify  Employee as provided in subsection  (a) of this Section 12, except to
the extent such restrictions or limitations are required by applicable law.

     13. ADDITIONAL PROVISIONS.

          (a) This Agreement shall not be assigned by either Company or Employee
without the other party's prior written consent; otherwise, this Agreement shall
be  binding  upon,  and shall  inure to the  benefit  of,  the  heirs,  personal
representatives, successors and assigns of Company and Employee respectively.

          (b) This  Agreement  and the rights  and  obligations  of Company  and
Employee  shall be governed by, and shall be construed in accordance  with,  the
laws of the State of Arizona without the application of any laws of conflicts of
laws that  would  require  or permit  the  application  of the laws of any other
jurisdiction.

          (c)  Time is of the  essence  of this  Agreement  and  each  provision
hereof.

          (d) This Agreement sets forth the entire  understanding of Company and
Employee  with  respect to the matters set forth herein and cannot be amended or
modified  except by an  instrument  in writing  signed by the party against whom
enforcement is sought.

          (e) This Agreement is the result of  negotiations  between Company and
Employee,  and Company and Employee  hereby waive the application of any rule of
law that otherwise would be applicable in connection with the interpretation and
construction of this Agreement that ambiguous or conflicting terms or provisions
are to be  interpreted  or construed  against the party who (or whose  attorney)
prepared the executed Agreement or any earlier draft of the same.

          (f) If any provision or any portion of any provision of this Agreement
shall be deemed to be  invalid,  illegal  or  unenforceable,  the same shall not
alter the  remaining  portion of such  provision or any other  provision of this
Agreement,  as each  provision of this  Agreement  and portion  thereof shall be
deemed severable.

          (g) Except as may be otherwise required by law, any notice required or
permitted to be given under this  Agreement  shall be given in writing and shall
be given either by (i) personal delivery,  or (ii) overnight courier service, or
(iii)  facsimile  transmission,  or (iv) United  States  certified or registered
mail,  in each case with  postage  prepaid to the  following  address or to such
other  address as Company or Employee may designate by notice given to the other
party pursuant to this section.  Notice shall be effective on (v) the day notice
is personally  delivered,  if notice is given by personal delivery,  or (vi) the
first business day after the date of delivery to the overnight delivery service,
if notice is given by such a delivery service, (vii) the day notice is received,
if notice is given by facsimile,  or (viii) the fourth business day after notice
is deposited  in the United  States  mail,  if notice is given by United  States
certified or registered mail.

         Company:          Poore Brothers, Inc.
                           3500 South La Cometa Drive
                           Goodyear, Arizona 85338
                           Fax No. (623) 925-2363

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         Employee:         John M. Silvestri

                           -------------------------------

                           -------------------------------
                           Fax No. --
                                      --------------------

          (h) If any action,  suit or proceeding  is brought in connection  with
this Agreement,  or on account of any breach of this Agreement, or to enforce or
interpret any of the terms,  covenants and  conditions  of this  Agreement,  the
prevailing  party shall be entitled to recover  from the other party or parties,
the prevailing  party's  reasonable  attorneys'  fees and costs,  and the amount
thereof shall be determined by the court (not by a jury) or the  arbitrator  and
shall be made a part of any judgment or award rendered.

                                        POORE BROTHERS, INC. ("Company")


                                        By
                                            ------------------------------------
                                        Its
                                            ------------------------------------


                                        JOHN M. SILVESTRI ("Employee")

                                        ----------------------------------------

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