EXHIBIT 10.1
EMPLOYMENT AGREEMENT

This Employment Agreement is effective the 1st day of February, 2008, between
South Dakota Soybean Processors, LLC, a South Dakota limited liability company,
and Rodney G. Christianson (“Employee”).

THE PARTIES AGREE AS FOLLOWS:

1.    Definitions. The following terms shall have these meanings:

a.    “Affiliate” or “Affiliates” shall mean any Person who controls, is
controlled by, or is under common control with, either directly or indirectly,
or through one or more intermediaries, the Employer. For purposes of this
Agreement, the term Affiliate shall include Urethane Soy Systems Co.

b.    “Base Salary” shall mean Employee’s annual compensation as
set forth in paragraph 6 of this Agreement.

c.    “Confidential Information” shall mean any and all information disclosed by
Employer or Affiliate to Employee, whether prior to or during the term of this
Agreement, relating to those matters not generally known to the public or the
industry in which Employer and/or an Affiliate is or may become engaged and
which pertain to the operations, processes, methods, and accumulated experience
incidental to the manufacture, processing, sale, and distribution of Employer’s
and/or an Affiliate’s Products, regardless of whether Employer and/or an
Affiliate provides such information to Employee in tangible form or the
information is retained in the memory of Employee. Confidential Information
includes, for example, and without limitation: (i) sales records, pricing
manuals, training manuals, selling and pricing procedures, and financing
methods, (ii) trade secrets and other know-how regarding businesses, products
and services, (iii) personnel and salary information, including wages, bonuses,
commissions, and fringe benefits, (iv) production and processing procedures,
formulae and systems, (v) vendor and supplier information, (vi) Customer lists
and Prospective Customer Lists including, without limitation, names of contacts,
products and services purchased, quantities purchased, credit histories, timing
of purchases, payment histories, special demands of particular Customers, and
current and anticipated requirements of Customers generally for products or
services, (vii) marketing information, including without limitation, research,
development, testing and customer surveys, and any specifications of any new
products or services under development, and (viii) business projections,
strategic plans, marketing systems and procedures, and inventory procedures and
systems.

d.    “Control,” “Controlled by” and “under common control with” shall mean the
power, directly or indirectly, to direct or cause the direction of the
management and policies of a Person whether through the ownership of voting
securities or by contract or otherwise.

 
 

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e.    “Customer” shall mean an individual, business or entity with which
Employer or an Affiliate did business during the two (2) year period preceding
the termination of Employee’s employment as provided in this Agreement.

f.    “Incentive Compensation” shall mean compensation paid to Employee as set
forth in paragraph 7 of this Agreement.

g.    “Person” means an individual, partnership, limited partnership, limited
liability company, trust, estate, corporation, cooperative, custodian, trustee,
executor, administrator, nominee or entity in a representative capacity.

h.    “Products” shall mean all products manufactured and/or sold by Employer or
an Affiliate, including polyurethane, plastics, resins, soybeans, soybean meal,
soybean oil and other soybean products.

i.    “Prospective Customer” shall mean a potential customer of Employer or an
Affiliate, which has been contacted by Employer or an Affiliate and for which
Employer or an Affiliate has made a financial investment, such as time, travel,
equipment or material during the two (2) year period preceding the termination
of Employee’s employment as provided in this Agreement.

2.    Employment. Employer agrees to employ Employee and Employee accepts
employment upon the terms and conditions set forth in this Agreement.

3.    Duties and Review. Employee shall be engaged in full-time employment by
Employer as its Chief Executive Officer and shall devote sufficient time and
attention to the business of Employer, including general management and
oversight of Affiliates, as shall be necessary to complete Employee's
obligations. Employer, through its Board of Managers, shall have the power to
determine the specific duties to be performed by Employee and the time of
performance. Employee shall undergo performance reviews from time to time during
the term of this Agreement at the request of Employer’s Board of Managers.

4.    Other Activities. Employee shall devote substantially all of his working
time and efforts during Employer’s normal business hours to the business of
Employer, including the general management and oversight of Affiliates. Employee
shall be free to invest his assets in a manner that will not require any
substantial services by Employee in the conduct of the business of the entities
or in the management of the properties in which he invests.

5.    Term. This Agreement is for a term of four (4) years commencing on the 1st
day of February, 2008, and terminating on the 31st day of January, 2012, unless
sooner terminated pursuant to the provisions of this Agreement.

6.    Base Salary. For all services to be rendered by Employee pursuant to this
Agreement, Employer agrees to pay Employee compensation at an annual rate of:
 
 
 

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(a) $300,000.00 until January 31, 2009 (year 1);

(b) $325,000.00 from February 1, 2009 until January 31, 2010 (year 2); and
(c) $350,000.00 from February 1, 2010 until January 31, 2012 (year 3 and year
4).

This Base Salary shall be paid in periodic installments in accordance with the
Employer’s regular payroll practices. Each installment shall be reduced by
deductions for the withholding of federal income tax, FICA contributions, and
all other deductions required by law or agreed to by Employee.

7.    Incentive Compensation. In addition to the Base Salary, Employee shall be
paid a bonus equal to one-half (1/2) of one percent (1%) of Employer’s net
income before taxes and member distributions on net income from $2,000,000.00 up
to $5,000,000.00 If the net income is $5,000,001.00 to $7,500,000.00, Employee
shall be paid a bonus equal to one percent (1%) of Employer’s net income. If net
income is greater than $7,500,000.00, Employee shall still be paid a bonus equal
to one percent (1%) of Employer’s net income and will also be paid an additional
bonus equal to one percent (1%) of the amount of the excess of Employer’s net
income over $7,500,000.00. If net income is below $2,000,000.00, no bonus will
be paid. Examples: $1,825,000.00 net income = no bonus; $4,386,000.00 net income
x .5% = $21,930.00; $6,500,000.00 net income x 1% = $65,000.00; or $8,500,000.00
net income x 1% = $85,000.00 plus $8,500,000.00 - $7,500,000.00 = $1,000,000.00
x 1% = $10,000.00 for a total bonus of $95,000.00. This incentive bonus may be
paid directly or deferred at Employee’s option. The calculation of Employer’s
net income shall include the net income of all of Employer’s subsidiaries for
which combined and audited financial statements must be prepared for GAAP
(“Generally Accepted Accounting Principles”) purposes. Net income shall be
calculated under the GAAP method of accounting utilized by Employer for its
audited financial statements and shall exclude any items of income or expense
that would be considered to be extraordinary and not arising in the ordinary
course of business. Such items could include but are not limited to the
following:

 
i.
Capital gains or losses from the sale of marketable securities or other
investments of Employer.

 
ii.
Gains or losses on the sales or dispositions of fixed assets.

 
iii.
Insurance proceeds received by Employer for the loss of property, capital
assets, or other assets of Employer.

 
iv.
Investment income from securities held by Employer, e.g., interest income,
dividend income, etc.

 
v.
Payment of a legal settlement, or receipt of monies relating to Employer’s
involvement in litigation or other disputes.

Such items shall be determined by Employer’s Financial Audit Committee and
subsequently adjusted out of net income for purposes of the calculation of this
incentive bonus. The incentive bonus shall be paid in full within thirty (30)
days following completion of Employer’s audited financial statements in the year
following the year for which the net income is calculated.

8.    Holidays and Vacations. Employee shall be entitled to nine (9) paid
holidays: New Year’s Day, Easter, Memorial Day, Fourth of July, Labor Day,
Thanksgiving, the day after Thanksgiving and Christmas, and a personal floating
holiday. Employee shall be entitled to

 
 

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twenty (20) days paid vacation during each fiscal year of employment. Employee
shall take his vacation at such time or times as shall be approved by Employer’s
Board of Managers. Employee’s vacation time will be administered in accordance
with Employer’s current vacation policies for all employees.

9.    Benefits. Employee shall receive the benefits, including participation in
insurance benefits and retirement plans, that are provided to Employer’s
employees, provided Employee meets the qualification provisions of each plan.

10.    Life Insurance. Employer may, in its discretion, purchase or renew
insurance on the life of Employee. Employee agrees to submit to reasonable
medical examinations and otherwise reasonably cooperate with Employer in
connection with obtaining such insurance.

11.    Expenses. During the term of this Agreement, Employee shall be entitled
to prompt reimbursement by Employer of all reasonable travel, entertainment, and
other expenses incurred by Employee in accordance with the policies and
procedures established by Employer’s Board of Managers and in the performance of
his duties and responsibilities under this Agreement; provided, that Employee
shall properly account for such expenses and present receipts as required by IRS
guidelines.

12.    Vehicle. During the term of this Agreement, Employee shall be provided a
vehicle for use for company business. The type and cost of the vehicle as well
as its replacement date will be determined by Employer’s Board of Managers.

 
13.
Termination and Severance Pay.

a.    Termination. This Agreement shall terminate immediately: (i) upon
Employee’s death, (ii) upon Employee becoming disabled, which determination
shall be made by Employer’s Board of Managers on the basis of medical evidence
satisfactory to it, in its sole discretion, that Employee is so mentally or
physically disabled as to be unable to fulfill Employee’s duties and
responsibilities and that such disability is likely to be permanent; (iii) upon
written notice from Employer that Employee’s employment is being terminated for
“Cause” as defined in paragraph 13(c) below; (iv) upon written notice from
Employer that Employee’s employment is being terminated without “Cause” as
defined in paragraph 13(c) below; or (v) upon Employee’s resignation of
employment. In the event of Employee’s termination under this paragraph 13(a),
he or his estate shall be entitled to receive the Base Salary and other benefits
to which he is entitled under this Agreement up to the date of termination.
Employee or his estate shall have no rights pursuant to this Agreement to any
benefits or compensation for any period after the date of termination.

b.    Severance Pay. If Employer terminates the employment of Employee for any
reason other than as provided below in this subparagraph b, Employer shall pay
Employee a sum equal to 1.5 times Employee’s Base Salary (at the annual rate
then existing under paragraph 6) calculated for a one year period. Payment shall
be made in

 
 

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eighteen (18) equal monthly installments or as otherwise mutually agreed by the
parties beginning on the first day of the month following termination of
employment. For example, if Employer terminates Employee’s employment without
“Cause” on August 1, 2009, Employee shall be entitled to severance pay of
$487,500.00 ($325,000.00 x 1.5) to be paid in 18 equal monthly installments of
$27,083.33 each. For example, if Employer terminates Employee’s employment
without “Cause” on September 1, 2010, Employee shall be entitled to severance
pay of $525,000.00 ($350,000.00 x 1.5) to be paid in 18 equal monthly
installments of $29,166.66 each. Despite anything in this Agreement to the
contrary, Employee shall not be eligible to receive the severance pay described
in this paragraph 13(b) if: (i) Employee’s employment is terminated due to
Employee’s death; (ii) Employee’s employment is terminated due to Employee’s
disability; (iii) Employee’s employment is terminated for “Cause”; (iv) Employee
voluntarily resigns his employment with Employer, (v) Employee’s employment is
terminated because Employer has ceased all business activities, become insolvent
and/or has filed a voluntary petition in bankruptcy, or has had filed against it
an involuntary petition in bankruptcy; (vi) Employee is employed in a similar
position by a successor company that has purchased substantially all of the
assets of Employer, or (vii) Employer is merged into another company and
Employee is retained by the surviving company in a similar position.

c.    For “Cause” Termination. Justifications for the Employer to terminate
Employee’s employment for “Cause” shall include: (i) Employee’s confession or
conviction of theft, fraud, embezzlement, or any other crime involving
dishonesty with respect to Employer, or any Affiliate, (ii) Employee’s excessive
absenteeism (other than by reason of physical injury, disease, or mental
illness) without reasonable cause, (iii) Employee's act or omission constituting
a material breach of any provision of this Agreement or any non-compliance with
Employee's obligations under paragraphs 14, 17 and 18 of this Agreement, (iv)
habitual and material negligence by Employee in the performance of his duties
under this Agreement, (v) abusing, misusing or destroying Employer's property or
the property of Customers or other employees, (vi) making or publishing false,
vicious or malicious statements concerning Employer, its operations, employees
or members of the Board of Managers, (vii) habitually reporting for work under
the influence of intoxicants or drugs, or (viii) Employee’s intentional
violation of any law directly impacting Employer’s business, including any law
prohibiting discriminatory conduct, or the direction of another employee to
violate any such law. The preceding list is not intended to be exhaustive; other
conduct of similar nature may result in termination of Employee. However, the
results of Employer’s or Affiliates’ operations or any business judgment made in
good faith by Employee shall not constitute an independent basis for termination
of Employee's employment for Cause under this Agreement.

14.    Limitation of Competitive Activities. During the term of Employee’s
employment with Employer and for a period of two (2) years after termination of
Employee’s employment, with or without cause, Employee will not, alone or with
others, directly or indirectly, own or have an interest in another company
(except for an ownership interest not to exceed 2% of the outstanding securities
of a company that is required to report to the United

 
 

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States Securities and Exchange Commission under the Securities Exchange Act of
1934), work in, plan, or engage in any employment, consulting, or other business
activity, whether or not for compensation, that is competitive with Employer or
its Affiliates within a five hundred (500) mile radius from Volga, South Dakota.
Employee will not engage in any other activity that conflicts with Employee’s
obligations to Employer during the term of this Agreement. The provisions of
this paragraph 14 shall survive the termination of Employee’s employment under
this Agreement for any reason whatsoever.

15.    Other Solicitation and Interference Limitations. For a period of two (2)
years after termination of Employee’s employment, with or without cause,
Employee shall not directly or indirectly solicit or aid in the solicitation of
any Customers or Prospective Customers, and shall not interfere with the
relationship between Employer and its Affiliates, or any of their respective
employees, vendors, or suppliers. Employee agrees not to solicit or assist
others in soliciting any Customers or Prospective Customers, employees, vendors,
or suppliers of Employer and/or its Affiliates, directly or indirectly, even if
participating in a business outside of the five hundred (500) mile radius from
Volga, South Dakota. The provisions of this paragraph 15 shall survive the
termination of Employee's employment under this Agreement for any reason
whatsoever.

16.    Ownership of Confidential Information. Employee acknowledges and agrees
that all Confidential Information disclosed to Employee is and remains the
exclusive property of Employer and/or its Affiliates. Employee acknowledges that
the Confidential Information was and will continue to be developed and acquired
by Employer and/or its Affiliates at great effort and expense, is valuable to
the owner thereof and constitutes trade secrets unique to the owner thereof.

17.    Non-Disclosure of Confidential Information. Employee shall treat
Confidential Information in a secret and confidential manner. Employee shall
comply with Employer’s and its Affiliates’ procedures for maintaining the
confidentiality of Confidential Information and agrees not to make use of or
disclose Confidential Information without the owner’s written consent, directly
or indirectly, for any purpose whatsoever, to any person or entity outside of
the owner’s business, either during the term of Employee’s employment or after
termination of Employee’s employment, whether with or without cause. The
provisions of this paragraph 17 shall survive the termination of Employee's
employment under this Agreement for any reason whatsoever.

18.    Delivery of Confidential Information and Employer Property. Upon request
of Employer and/or an Affiliate and in any event upon termination of Employee’s
employment, with or without cause, Employee shall promptly deliver to the
Employer or any Affiliate all Confidential Information, including, without
limitation, all originals, copies, summaries or extracts of books, catalogues,
sale brochures, Customer lists, Prospective Customer lists, price lists,
employee manuals, notes, photographs, tape recordings, specifications,
operations manuals and all other documents or tangible materials reflecting or
referencing Confidential Information, as well as all other materials furnished
to or acquired by Employee as a result of or during the course of Employee’s
employment. The provisions of this paragraph 18 shall survive the termination of
Employee’s employment under this Agreement for any reason whatsoever.

 
 

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19.    Reasonableness of Restrictions and Enforcement. Employee acknowledges
that he has carefully read and considered the provisions of this Agreement and,
having done so, agrees that the restrictions and limitations in this Agreement
are reasonable as to geographic scope and duration and are necessary to protect
Employer’s and its Affiliates’ proprietary interests in their respective
Confidential Information and to preserve for Employer and its Affiliates the
competitive advantages necessary for their success.

20.    Remedies. Employee acknowledges and agrees that it is impossible to
measure in money the damages which will accrue to Employer and/or its Affiliates
if Employee should breach or is in default of any of Employee's covenants or
representations set forth in this Agreement, and that Employer and/or its
Affiliates would be irreparably damaged by such breach or default by Employee.
Accordingly, if any action or proceeding is instituted by or on behalf of any of
the foregoing to enforce any term of this Agreement, Employee waives any claim
or defense that Employer and/or its Affiliates have an adequate remedy at law or
that Employer and/or its Affiliates have not been, or are not being, irreparably
injured. The rights and remedies of Employer and/or its Affiliates pursuant to
this paragraph are cumulative and shall not be deemed to exclude any other right
or remedy which Employer and/or its Affiliates may have pursuant to this
Agreement or otherwise, at law or in equity.

21.    Indemnification. Employee shall indemnify and hold harmless Employer, its
Affiliates, and their respective owners, officers, managers, directors, other
employees, agents, and assigns from any and all claims, damages, liabilities,
attorneys’ fees and expenses arising out of Employee’s violation of any of the
terms and conditions of this Agreement.

22.    Expenses of Enforcement. If Employee breaches or threatens to breach any
of the covenants described in this Agreement, then, in addition to any of the
rights and remedies which Employer and/or its Affiliates may have against
Employee, Employee will be liable to pay Employer’s court costs and reasonable
attorneys' fees incurred in enforcing this Agreement.

23.    Termination of Prior Agreements and Modification. Employee acknowledges
that any prior agreement with Employer as to employment was rightfully
terminated at Employer’s discretion prior to execution of this Agreement. This
Agreement constitutes the entire Agreement between Employer and Employee. It is
independent of and supplants all oral or written agreements entered prior to or
contemporaneously with this Agreement, except for the First Amended and Restated
Deferred Compensation Plan made effective February 1, 2004. This Agreement may
not be modified except by written agreement dated subsequent to the date of this
Agreement and signed by both Employer and Employee.

24.    Severability. If any provision of this Agreement shall be held by a court
of competent jurisdiction to be unenforceable or invalid, the remaining
provisions will remain in full force and effect. In the event that any of the
restrictions or limitations contained in paragraphs 14 and 15 of this Agreement
are held to exceed the time or geographic limitations permitted by applicable
law, then such restrictions or limitations shall be deemed to be reformed to the
maximum time and geographic limitations permitted by law. If any other provision
of this

 
 

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Agreement is held to be overbroad as written, the provision shall be deemed
amended to narrow its application to the extent necessary to make it enforceable
to the fullest extent allowable.

25.    Successors and Assigns. This Agreement is personal to Employee and is not
assignable in whole or in part by Employee without the express written consent
of Employer. Any purported assignment by Employee without Employer's consent
will constitute a breach for which Employer has the right to terminate this
Agreement.

26.    Presumptions. In construing the terms of this Agreement, no presumption
shall operate in either party’s favor as a result of counsel's role in drafting
the Agreement's terms or provisions.

27.    Waiver of Breach. The waiver by Employer of breach of any covenant of
this Agreement or the failure of Employer to take action against any other
employee for similar breaches on their part, shall not operate or be construed
as a waiver of any subsequent or later breach by Employee. No waiver by Employer
shall be effective unless in writing.

28.    Text Controls. The headings of paragraphs and sections are included
solely for convenience. If a conflict exists between any heading and the text of
this Agreement, the text shall control.

29.    Governing Law. All rights and obligations arising out of or relating to
this Agreement shall be governed by and construed in accordance with the laws of
the State of South Dakota.

30.    Dispute Resolution. All disputes between Employer and Employee arising
out of or relating to this Agreement and/or Employee’s employment shall be
exclusively and finally resolved through the dispute resolution process set
forth in Exhibit A.
 
 
[Signature page follows]

 
 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the 25th day
of April, 2008.
 
SOUTH DAKOTA SOYBEAN PROCESSORS, LLC
 
 
By:  /s/ Ronald Gorder

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Its President
 
/s/ Rodney Christianson

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Rodney G. Christianson
 
 
 
 

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EXHIBIT A

DISPUTE RESOLUTION PROCESS

1.    Arbitration. All disputes between Employer and Employee arising out of or
relating to this Agreement and/or Employee’s employment shall be exclusively and
finally resolved through binding arbitration by a single arbitrator. The
arbitrator shall also exclusively and finally resolve all issues relating to the
operation of this Process, including but not limited to all disputes relating to
the validity or enforceability of this Process, the timeliness of an arbitration
demand made pursuant to subparagraph 1.a.ii, the applicability of this paragraph
to a dispute between Employer and Employee, and the exclusion of other remedies
pursuant to paragraph 3.

a.    Demand for Arbitration. Either party to this Agreement may initiate
arbitration pursuant to this paragraph by delivering, by certified mail, a
written demand for arbitration to the other party at such party’s current
business address.

i.    Contents of Demand. The demand for arbitration shall bear a current date
and shall state the name of the initiating party, a brief description of the
matter sought to be arbitrated, and the amount of damages or other relief sought
by the initiating party.
 
ii.    Time for Demand. A demand for arbitration relating to any claim by
Employee or Employer shall be made within the time within which commencement of
legal or equitable proceedings based on such claim could be made under the South
Dakota statute of limitations or repose applicable to such claim. Any claim not
initiated by a demand for arbitration within the times provided in this
paragraph 1.a.ii shall be deemed waived and forever barred.

b.    Qualifications and Appointment of Arbitrator. Unless otherwise agreed by
the parties, the arbitrator shall be an attorney licensed to practice law in the
State of South Dakota and shall have experience in resolving or litigating the
type of claim, dispute or matter at issue in the arbitration. The parties shall
mutually agree upon an arbitrator. If the parties are unable to so agree, each
party shall designate an attorney licensed to practice law in the State of South
Dakota and that is unaffiliated with Employer, Employee, and their respective
attorneys, and such third party attorneys shall mutually agree upon an
arbitrator.

c.    Cash Undertaking. Within ten (10) days following the appointment of an
arbitrator by the parties or their representatives, each party asserting a claim
or counterclaim in the arbitration shall deposit with the arbitrator a cash
undertaking in the amount of $5,000.00, which undertaking shall be applied to
any costs, fees or expenses awarded against the party pursuant to subparagraph
1.g.

d.    Governing Law. The arbitrator shall resolve all claims solely on the basis
of South Dakota law. The arbitrator shall also resolve all issues relating to
the operation
 
 
 

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of this Process solely on the basis of South Dakota law, including but not
limited to all disputes identified in paragraph 1 above. The parties shall be
permitted to conduct discovery pursuant to SDCL §§ 15-6-26 through 15-6-37; all
discovery disputes shall be resolved by the arbitrator pursuant to these
provisions and applicable case law. The arbitrator shall conduct all arbitration
proceedings pursuant to the South Dakota Rules of Evidence, codified at SDCL
Chapters 19-9 through 19-18, and applicable case law.

e.    Location. All arbitration proceedings shall take place in Brookings, South
Dakota, unless otherwise agreed by the parties.

f.    Form of Award; No Appeal; Entry of Award. The arbitrator shall issue a
written award setting forth the arbitrator’s findings of fact, conclusions of
law, decision and monetary award. Except as otherwise permitted by SDCL Chapter
21-25A, no party shall appeal to any court an award of an arbitrator issued
under this paragraph 1.f, and the decision of the arbitrator shall be the final,
binding and conclusive resolution of the dispute. Any party to the arbitration
may apply to a court of competent jurisdiction for entry or confirmation of the
arbitration award. Notwithstanding the foregoing, the issuance of an award
pursuant to this subparagraph 1.f shall not preclude a party from applying to
the arbitrator for costs, fees and expenses as provided in subparagraph 1.g, nor
shall it preclude the arbitrator from modifying the award to provide for the
recovery of such costs, fees and expenses. Any application for costs, fees and
expenses shall be delivered to the arbitrator within thirty (30) days of the
date of the arbitration award.

g.    Allocation of Costs, Fees and Expenses. The arbitrator shall award to the
prevailing party, as determined by the arbitrator pursuant to this subparagraph
1.g, all costs, fees and expenses relating to the arbitration, including
reasonable expert witness and attorneys’ fees, unless the arbitrator finds a
substantial reason for not doing so, which reason shall be explained in writing
by the arbitrator. As used in this subparagraph, a party that is seeking an
affirmative damage award shall constitute a “prevailing party” only if such
party is awarded damages, exclusive of costs, fees and expenses relating to the
arbitration (including reasonable expert witness and attorneys’ fees), in excess
of the last written settlement demand made by such party. A party against whom
damages are sought shall constitute a “prevailing party” only if such party is
ordered to pay damages, exclusive of costs, fees and expenses relating to the
arbitration (including reasonable expert witness and attorneys’ fees), in an
amount less than the last written settlement offer made by such party. If no
party constitutes a prevailing party pursuant to the preceding two sentences,
the arbitrator may award costs, fees and expenses relating to the arbitration,
including reasonable expert witness and attorneys’ fees, in the arbitrator’s
discretion. Where parties are asserting affirmative claims against one another,
any separate written settlement demands or offers made on such claims shall be
combined for purposes of this subparagraph. No written demand or offer made less
than ten (10) days prior to the arbitration hearing shall be considered for
purposes of this subparagraph. All settlement demands or offers shall be kept
confidential and shall not be disclosed to the arbitrator, except in connection
with an application for costs, fees and expenses made pursuant to this
subparagraph and subparagraph 1.f.

 
 

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2.    Mediation. At any time after a demand for arbitration has been made
pursuant to paragraph 1.a, any party to the arbitration may request mediation. A
mediation shall be conducted only if all parties to the arbitration consent to
mediation.

a.    Request for Mediation. The request for mediation shall be in writing and
shall be delivered by certified mail to the current business address of each
unrepresented party to the arbitration and to counsel of each represented party
to the arbitration. The request shall bear a current date and shall state the
name of the requesting party and a brief description of the matter sought to be
mediated.

b.    Qualifications and Appointment of Mediator. Unless otherwise agreed by the
parties, the mediator shall be an attorney licensed to practice law in the State
of South Dakota and shall have experience in resolving or litigating the type of
claim, dispute or matter at issue in the mediation. The parties shall mutually
agree upon a mediator. If the parties are unable to so agree, each party shall
designate an attorney licensed to practice law in the State of South Dakota and
that is unaffiliated with Employer, Employee, and their respective attorneys,
and such third party attorneys shall mutually agree upon a mediator. The
mediator of any dispute submitted to mediation under this paragraph 2 shall not
be the same person serving as arbitrator of such dispute, unless otherwise
agreed by the parties.

c.    Location. The mediation shall take place in Brookings, South Dakota,
unless otherwise agreed by the parties.

d.    Allocation of Mediation Costs. Costs of the mediation shall be borne
equally by the parties, unless otherwise agreed by the parties.

3.    Exclusive Remedy. This Exhibit A contains and shall constitute the sole
and exclusive remedy of the parties with respect to any and all disputes, claims
or other matters arising out of or relating to this Agreement and/or Employee’s
employment. The parties hereby waive any and all other remedial rights with
respect to such disputes, claims or other matters, whether in law or in equity.
 
 

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