EXHIBIT

10.1




 




SALE BONUS AGREEMENT




 




This SALE BONUS AGREEMENT (is entered into as of

January 1, 2003 between Gardenburger, Inc., an Oregon corporation (the

“Company”), and Lorraine Crawford (“Executive”), and is an addition to any

existing Employment Agreement.




 




In consideration of the mutual covenants set forth in

this Agreement and in any Original Employment Agreement, the parties agree as

follows:




 




1.             Sale Bonus




 




(a)           After

the completion of a “Sale Transaction,” as defined below, the Company will pay

Executive a “Sale Bonus,” as described below, provided Executive remains as

Vice President of Finance of the Company during the negotiation of and

through the closing of the Sale Transaction. 

The Sale Bonus will be payable to Executive after all post–closing

adjustments in connection with the Sale Transaction have been determined.




 




(b)           For purposes of this paragraph 1:




 




(i)                                     A

“Sale Transaction” means a single transaction or a series of related

transactions approved by the Board of Directors of the Company resulting in:




 




•                                          A

sale or other disposition by the Company of all or substantially all its

assets;




 




•                                          A

sale, share exchange, or other disposition of all or substantially all the

capital stock of the Company;




 




•                                          A

merger, consolidation, or other corporate transaction with a third party in

which the Company’s shareholders receive cash, stock, securities, or any other

consideration (or any combination of the foregoing) in exchange for their stock

in the Company.




 




(ii)                                  The

“Sale Bonus” is an amount equal to the sum of (i) .15 percent of the

portion of the “Total Consideration”. (as defined below)




 




(iii)                               The

“Total Consideration” in connection with a Sale Transaction means:




 




•                                          The

amount of cash and the aggregate market value of all other consideration

received by the Company in connection with a sale or other disposition of its

assets (exclusive of any indebtedness or liabilities of the Company to which

the assets taken are subject or which are assumed by the purchaser or other

acquirer of the Company’s assets); or




 




1





























 




•                                          The

aggregate amount of cash and the aggregate market value of all other

consideration received by the Company’s shareholders in any sale, share

exchange, or other disposition of the Company’s stock or any merger,

consolidation, or similar transaction.




 




2.             Cashless Sales Transaction.  The board at its sole discretion, reserves

the right to provide consideration other than cash in an amount equivalent to

this Sale Bonus in the event of cashless Sales Transaction.




 




3.             Stock Options.  The executive has previously been granted stock options for

Gardenburger common stock that may have value in a Sale Transaction.  The amount of the total Sale Bonus will be reduced

by any gain experienced through the exercise of the executive’s stock options

in a Sale Transaction.




 




4.             Withholding and Payroll Taxes.  All amounts payable by the Company to

Executive pursuant to this Agreement are subject to and will be reduced by

amounts the Company is required to withhold for all applicable federal, state,

and local income and payroll taxes.




 




The parties have executed this Agreement as of the

date first set forth above.




 




	

   


  	

  GARDENBURGER,

  INC.


  
	

   


  	

   


  
	

   


  	

   


  
	

   


  	

  By:


  	

  /s/ Scott C. Wallace


  	

   


  
	

   


  	

   


  	

  Scott C. Wallace


  
	

   


  	

   


  	

  President and Chief Executive Officer


  
	

   


  	

   


  
	

   


  	

  EXECUTIVE


  
	

   


  	

   


  
	

   


  	

   


  	

  /s/ Lorraine Crawford


  	

   


  
	

   


  	

   


  	

  Lorraine Crawford


  





 




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