SunOpta Inc.: Exhibit 10.7 - Filed by newsfilecorp.com






Exhibit 10.7 

EMPLOYMENT AGREEMENT 

This Employment Agreement (“Agreement”) is between SunOpta Inc.
(such entity together with all past, present, and future parents, divisions,
operating companies, subsidiaries, and affiliates are referred to collectively
herein as the “Company”) and James P. Gratzek (“Employee”). 

	1. 	
      EMPLOYMENT



This Agreement commences August 18, 2016 (“Effective Date”),
shall continue in effect until December 31, 2018, and shall continue in effect
each year thereafter unless by October 31, 2018 (or October 31 of a subsequent
year), a party gives notice to the other party of termination of the Agreement,
in which case the Agreement will terminate as of December 31 of the year in
which such notice is given. Employment during the course of the Agreement shall
be on an “at-will” basis, and either party has the right to terminate Employee’s
employment for any reason, or for no reason, upon two-months written notice. The
Company, in its sole discretion, may elect to accelerate the employment
termination date and pay Employee in lieu of notice for the two-month notice
period and Employee has no guarantee of continued employment during the notice
period. The Company also has the right to terminate Employee’s employment
immediately for Cause (as defined in Section 7 below).

	2. 	
      TITLE AND EXCLUSIVE
SERVICES




	(a) 	
      Title and Duties. Employee’s title is Senior Vice
      President Research & Development and Quality, and Employee will
      perform job duties that are usual and customary for this position, all as
      determined by the chief executive officer or the Board or
  Directors.

	 	 
	(b) 	
      Exclusive Services. Employee shall not be employed
      or render services elsewhere while employed by the Company; provided,
      however, that Employee may participate in professional, civic or
      charitable organizations so long as such participation is unpaid and does
      not interfere with the performance of Employee’s duties to the
    Company.




	3. 	
      COMPENSATION AND
BENEFITS




	(a) 	
      Base Salary. Employee’s current annualized salary
      (“Base Salary”) is Two Hundred Seventy Seven Thousand Two Hundred Dollars
      ($277,200.00). Employee is also eligible for a five percent (5%) increase
      effective December 1, 2016. The Base Salary shall be payable in accordance
      with the Company’s regular payroll practices and pursuant to the Company
      policy, which may be amended from time to time. Employee’s Base Salary is
      subject to change from time to time by the Board of Directors or
      Compensation Committee of the Board of Directors (the “Compensation
      Committee”) in its discretion.

	 	 
	(b) 	
      Short Term Incentive. Employee will be eligible
      for participation in the Company’s annual short term cash incentive plan
      as approved and amended by the Board of Directors or the Compensation
      Committee in its discretion from time to time (the “Annual Short Term
      Incentive Plan”). For the 2016 fiscal year, Employee’s eligibility for
      participation in the Annual Short Term Incentive Plan will be based on a
      forty percent (40%) target of Employee’s Base Salary as of April 1, 2016.
      For years after 2016, the target level of participation will be
      established by the Board of Directors or the Compensation Committee. There
      is no guaranteed compensation under the Annual Short Term Incentive
      Plan.

	 	 
	(c) 	
      Long Term Incentive. Employee will be eligible for
      participation in the Company’s long term incentive plan as approved and
      amended by the Board of Directors or the
Compensation Committee at its discretion from time to time (the “Long
      Term Incentive Plan”), with the form, terms and amount of the awards as
      determined by the Board of Directors or the Committee. For the 2016 fiscal
      year, Employee’s eligibility for participation in the annual Long Term
      Incentive Plan will be based upon a forty percent (40%) target of
      Employee’s Base Salary as of April 1, 2016. For years after 2016, the
      target level of participation will be established by the Board of
      Directors or the Compensation Committee. There is no guaranteed
  compensation under the Long Term Incentive Plan.








	(d) 	
      Employment Benefit Plans. Employee may participate
      in all other employee welfare benefit plans in which other similarly
      situated employees may participate, according to the terms of applicable
      policies and as stated in the Employee Benefits Guide, which may be
      changed from time to time at the discretion of the Company. These benefits
      may include medical, dental, vision, short term disability, long term
      disability, life insurance, 401(k) and the Employee Stock Purchase
      Plan.

	 	 
	(e) 	
      Vacation. Employee is eligible for paid time off
      of four weeks (160 hours) per calendar year, prorated as necessary, and
      subject to the Employee Benefits Guide.

	 	 
	(f) 	
      Expenses. The Company will reimburse Employee for
      business expenses pursuant to the Company’s policies, which may be changed
      from time to time at the discretion of the Company.

	 	 
	(g) 	
      Taxes and Deductions. Compensation pursuant to
      this Agreement shall in all cases be subject to withholding for
      employment, payroll, income and other taxes and other
  deductions.




	4. 	
      NONDISCLOSURE OF CONFIDENTIAL
  INFORMATION




	(a) 	
      The Company has provided and will continue to provide to
      Employee confidential information and trade secrets including but not
      limited to the Company’s marketing plans, growth strategies, target lists,
      performance goals, operational and programming strategies, specialized
      training expertise, employee development, engineering information, sales
      information, client and customer lists, business and employment contracts,
      representation agreements, pricing and ratings information, production and
      cost data, compensation and fee information, strategic business plans,
      budgets, financial statements, technological initiatives, proprietary
      research or software purchased or developed by the Company, content
      distribution, and other information the Company treats as confidential or
      proprietary (collectively, the “Confidential Information”). Employee
      acknowledges that such Confidential Information is proprietary and agrees
      not to disclose it to anyone outside the Company except to the extent
      that: (i) it is necessary in connection with performing Employee’s duties;
      or (ii) Employee is required by court order to disclose the Confidential
      Information, provided that Employee shall promptly inform the Company,
      shall cooperate with the Company to obtain a protective order or otherwise
      restrict disclosure, and shall only disclose Confidential Information to
      the minimum extent necessary to comply with the court order. Employee
      agrees to never use trade secrets in competing, directly or indirectly,
      with the Company. When employment ends, Employee will immediately return
      all Confidential Information to the Company.

	 	 
	(b) 	
      The terms of this Section 4 shall survive the expiration
      or termination of this Agreement for any
reason.




	5. 	
      NON-INTERFERENCE WITH THE COMPANY
  EMPLOYEES




	(a) 	
      To further preserve the Company’s Confidential
      Information, goodwill and legitimate business interests, during employment
      and for twelve (12) months after employment ends (the “Non- Interference
      Period”), Employee will not, directly or indirectly, hire, engage or
      solicit any current employee of the Company with whom Employee had contact,
      supervised, or received Confidential Information about within the twelve
      (12) months prior to Employee’s termination, to provide services elsewhere
  or cease providing services to the Company.



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	(b) 	
      The terms of this Section 5 shall survive the expiration
      or termination of this Agreement for any
reason.




	6. 	
      NON-SOLICITATION OF
CUSTOMERS




	(a) 	
      To further preserve the Company’s Confidential
      Information, goodwill and legitimate business interests, for twelve (12)
      months after employment ends (the “Non-Solicitation Period”), Employee
      will not, directly or indirectly, solicit the Company’s customers with
      whom Employee engaged or had contact, or received Confidential Information
      about within the twelve (12) months prior to Employee’s
  termination.

	 	 
	(b) 	
      The terms of this Section 6 shall survive the expiration
      or termination of this Agreement for any
reason.




	7. 	
      CHANGE IN CONTROL




	(a) 	
      Definitions. For purposes of this
  Agreement:



“Change in Control” means the
occurrence of any of the following: 

(i) any “person” or “group” (within the
meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934,
as amended (“Exchange Act”)) shall, as a result of a tender or exchange offer,
open market purchases or privately negotiated purchases from anyone other than
the Company, have become the beneficial owner (within the meaning of Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
ordinarily having the right to vote for the election of directors (“Voting
Securities”) representing a majority of the combined voting power of the then
outstanding Voting Securities; or 

(ii) at any time during a period of two
consecutive years, individuals who at the beginning of such period constituted
the Board of Directors of the Company (“Incumbent Directors”) shall cease for
any reason to constitute at least a majority thereof; provided, however, that
the term “Incumbent Director” shall also include each new director elected
during such two-year period whose nomination or election was approved by
two-thirds of the Incumbent Directors then in office; or 

(iii) any consolidation, merger or plan
of exchange involving the Company (“Merger”) as a result of which the holders of
outstanding Voting Securities immediately prior to the Merger do not continue to
hold at least 50% of the combined voting power of the outstanding Voting
Securities of the surviving corporation or a parent corporation of the surviving
corporation immediately after the Merger, disregarding any Voting Securities
issued to or retained by such holders in respect of securities of any other
party to the Merger. 

(iv) any sale, lease, exchange, or
other transfer (in one transaction or a series of related transactions) of all
or substantially all of the assets of the Company (“Asset Sale”).

“Cause” means the occurrence of any of
the following:

(i) the commission of an act that
constitutes a felony under the laws of the United States or any individual State
or under the laws of a foreign country; or 

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(ii) the commission of an act of fraud,
embezzlement, sexual harassment, dishonesty, theft, or an intentional act that
results in a material loss, damage or injury to the Company; or 

(iii) the commission of an act of moral
turpitude which is materially injurious to the Company; or

(iv) the failure of Employee to
participate in the reasonable and lawful business activities of the Company in a
manner consistent with his job duties, provided such failure continues for more
than ten days after written notice to the Employee specifying such failure in
reasonable detail. 

“Good Reason” means the occurrence of
any of the following:

(i) a material diminution in Employee’s
base salary, authority, duties or responsibilities after the Change in Control
compared to immediately prior to the Change in Control; provided that Good
Reason shall not exist (A) solely as a result of a change in reporting
relationship or (B) if Employee continues to have the same or a greater general
level of responsibility for the Company operations after the Change in Control
as Employee had prior to the Change in Control even if the Company operations
are a subsidiary or division of the surviving company; or 

(ii) Employee is required to be based
more than eighty (80)miles from where Employee’s office is located immediately
prior to the Change in Control; or 

(iii) a material reduction in
Employee’s Base Salary or the Company or the surviving company fails to provide
substantially equivalent target incentive opportunities under short term and
long term incentive plans after the Change in Control as compared to immediately
prior to the Change in Control; or 

(iv) action or inaction by the Company
that constitutes a material breach under this Agreement; 

provided, however, that such
termination shall not be for “Good Reason” unless Employee provides notice to
the Company of the existence of the condition described above within 30 days of
the initial existence of the condition and the Company does not remedy such
condition on or before the 30th day following such notice (or the following
business day if such 30th day is not a business day). 

	(b) 	
      Termination of Employment following a Change in
      Control. If a Change in Control occurs and at any time during the
      twelve (12) months following the Change in Control the Company terminates
      Employee without Cause or Employee terminates Employee’s employment by the
      Company with Good Reason, subject to Employee’s compliance with Sections
      4, 5 and 6 of this Agreement and Employee’s execution of a release of
      claims in favor of the Company, its affiliates and their respective
      officers and directors in a form provided by the Company (the “Release”)
      and such Release becoming effective within 21 days following the date of
      employment termination (such 21- day period, the “Release Execution
      Period”), Employee shall be entitled to the
following:



(i) the Company will pay to Employee in
a lump sum an amount equal to twelve (12) months of base salary within 30 days
following the employment termination date; provided that, if the Release
Execution Period begins in one taxable year and ends in another taxable year,
payment shall not be made until the beginning of the second taxable year; and


(ii) all unvested stock options held by
Employee at the date of termination shall immediately become vested in full and
shall remain subject to the other terms of such stock options; and 

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(iii) if Employee timely and properly
elects continuation coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1985 (“COBRA”), the Company will pay the cost for the
monthly COBRA premium for Employee and Employee’s then-enrolled dependents.

Such COBRA reimbursement shall be paid
to the benefits provider. The Company shall continue to issue such COBRA
payments until the earliest of: (A) the twelve-month anniversary of the date of
termination of employment; (B) the date Employee is no longer eligible to
receive COBRA continuation coverage; and (C) the date on which Employee becomes
eligible to receive substantially similar coverage from another employer.

	(c) 	
      Treatment of Performance Share Units following the
      Company Sale. If a Merger or an Asset Sale (each, a “Company Sale”)
      occurs before the vesting date of any Performance Share Units held by
      Employee, Employee shall be entitled to receive a payout of shares no
      later than thirty (30) days following the Company Sale. The number of
      shares issued in such event shall be the amount determined by the payout
      factor calculated as if the performance period ended on the last day of
      the Company’s most recently completed fiscal quarter prior to the date of
      the Company Sale. For this purpose, performance measures and the related
      payout factors applicable to the awards in shall be adjusted by the Board
      of Directors of the Compensation Committee, to appropriately reflect the
      shorter performance period.




	8. 	
      OTHER TERMINATION.



Employee shall not be entitled to any benefits or compensation
under this Agreement in the event Employee’s employment terminates voluntarily
or involuntarily, for any reason, or no reason, except to the extent expressly
provided in Section 7(b). Employee, however, may be entitled to benefits under
any severance plan of the Company in effect at that time, which plans are
subject to change or termination by the Company at any time in its discretion.


	9. 	
      CONFLICTS OF INTEREST



Employee acknowledges familiarity with the Company policies on
conflicts of interest, and warrants that Employee will fully comply with such
policies. Employee shall certify compliance with the conflicts of interest
policy from time to time as requested by the Company. Employee shall notify the
Company immediately in writing if there is any attempt to induce Employee to
violate the conflicts of interest policy. 

	10. 	
      DISPUTE RESOLUTION




	(a) 	
      Arbitration. This Agreement is governed by the
      Federal Arbitration Act, 9 U.S.C. § 1 et seq. and evidences a
      transaction involving commerce. This Agreement applies to any dispute
      arising out of or related to Employee's employment with the Company or
      termination of employment. Nothing contained in this Agreement shall be
      construed to prevent or excuse Employee from using the Company’s existing
      internal procedures for resolution of complaints, and this Agreement is
      not intended to be a substitute for the use of such procedures. Except as
      it otherwise provides, this Agreement is intended to apply to the
      resolution of disputes that otherwise would be resolved in a court of law,
      and therefore this Agreement requires all such disputes to be resolved
      only by an arbitrator through a final and binding individual arbitration
      proceeding and not by way of court or jury trial or class action. Such
      disputes include without limitation disputes arising out of or relating to
      interpretation or application of this Agreement, including the
      enforceability, revocability or validity of this Agreement or any portion
      of this Agreement. This Agreement also applies, without limitation, to
      disputes regarding the employment relationship, trade secrets, unfair
      competition, compensation, breaks and rest periods, termination, or
      harassment and claims arising under the Uniform Trade Secrets Act,
      Civil Rights Act of 1964, Americans With Disabilities Act, Age
Discrimination in Employment Act, Family Medical Leave Act, Fair Labor Standards
Act, Employee Retirement Income Security Act, and state statutes, if any,
addressing the same or similar subject matters, and all other state statutory
and common law claims (excluding workers compensation, state disability
insurance and unemployment insurance claims). Any arbitration pursuant to this
Section 10 shall be subject to the commercial rules of the American Arbitration
Association. Claims may be brought before an administrative agency but only to
the extent applicable law permits access to such an agency notwithstanding the
existence of an agreement to arbitrate. Such administrative claims include
without limitation claims or charges brought before the Equal Employment
Opportunity Commission (www.eeoc.gov), the U.S. Department of Labor
(www.dol.gov), the National Labor Relations Board (www.nlrb.gov),
the Office of Federal Contract Compliance Programs
(www.dol.gov/esa/ofccp). Nothing in this Agreement shall be deemed to
preclude or excuse a party from bringing an administrative claim before any
agency in order to fulfill the party's obligation to exhaust administrative
remedies before making a claim in arbitration. Disputes that may not be subject
to pre-dispute arbitration agreement as provided by the Dodd-Frank Wall Street
Reform and Consumer Protection Act (Public Law 111-203) are excluded from the
coverage of this Agreement.



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	(b) 	
      Injunctive Relief. A party may apply to a court of
      competent jurisdiction for temporary or preliminary injunctive relief in
      connection with an arbitrable controversy, but only upon the ground that
      the award to which that party may be entitled may be rendered ineffectual
      without such provisional relief.

	 	 
	(c) 	
      This Section 10 is the full and complete agreement
      relating to the formal resolution of employment-related disputes. In the
      event any portion of this Section 10 is deemed unenforceable, the
      remainder of this Agreement will be enforceable.

	 	 
	(d) 	
      This Section 10 shall survive the expiration or
      termination of this Agreement for any reason.




	 	Employee Initials: __________	Company Initials:
__________



	11. 	
      SECTION 409(A)




	(a) 	
      General Compliance. This Agreement is intended to
      comply with Section 409A of the US Internal Revenue Code (“Section 409A”)
      or an exemption thereunder and shall be construed and administered in
      accordance with Section 409A. Notwithstanding any other provision of this
      Agreement, payments provided under this Agreement may only be made upon an
      event and in a manner that complies with Section 409A or an applicable
      exemption. Any payments under this Agreement that may be excluded from
      Section 409A either as separation pay due to an involuntary separation
      from service or as a short-term deferral shall be excluded from Section
      409A to the maximum extent possible. For purposes of Section 409A, each
      installment payment provided under this Agreement shall be treated as a
      separate payment. Any payments to be made under this Agreement upon a
      termination of employment shall only be made upon a "separation from
      service" under Section 409A. Notwithstanding the foregoing, the Company
      makes no representations that the payments and benefits provided under
      this Agreement comply with Section 409A, and in no event shall the Company
      be liable for all or any portion of any taxes, penalties, interest, or
      other expenses that may be incurred by Employee on account of non-
      compliance with Section 409A.

	 	 
	(b) 	
      Specified Employees. Notwithstanding any other
      provision of this Agreement, if any payment or benefit provided to
      Employee in connection with Employee’s termination of employment is
      determined to constitute “nonqualified deferred compensation” within the
      meaning of Section 409A and Employee is determined to be a “specified
      employee” as defined in Section 409A(a)(2)(b)(i), then such payment or benefit shall not be
paid until the first payroll date to occur following the six-month anniversary
of the employment termination date or, if earlier, on Employee’s death (the
“Specified Employee Payment Date”). The aggregate of any payments that would
otherwise have been paid before the Specified Employee Payment Date shall be
paid to Employee in a lump sum on the Specified Employee Payment Date and
thereafter, any remaining payments shall be paid without delay in accordance
with their original schedule. 



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	(c) 	
      Reimbursements. To the extent required by Section
      409A, each reimbursement or in-kind benefit provided under this Agreement
      shall be provided in accordance with the
following:



(i) the amount of expenses eligible for
reimbursement, or in-kind benefits provided, during each calendar year cannot
affect the expenses eligible for reimbursement, or in-kind benefits to be
provided, in any other calendar year; 

(ii) any reimbursement of an eligible
expense shall be paid to Employee on or before the last day of the calendar year
following the calendar year in which the expense was incurred; and 

(iii) any right to reimbursements or
in-kind benefits under this Agreement shall not be subject to liquidation or
exchange for another benefit. 

	12. 	
      MISCELLANEOUS



This Agreement supersedes any prior written or oral employment
agreements or understandings between the parties. No modification shall be valid
unless in writing and signed by the parties, relating to the subject matter of
this Agreement, unless otherwise noted herein.

If any provision of this Agreement shall, for any reason, be
held unenforceable, such unenforceability shall not affect the remaining
provisions hereof, except as specifically noted in this Agreement, or the
application of such provisions to other persons or circumstances, all of which
shall be enforced to the greatest extent permitted by law.

The Company and Employee agree that the restrictions contained
in Section 4, 5, and 6, are material terms of this Agreement, reasonable in
scope and duration and are necessary to protect the Company’s Confidential
Information, goodwill, specialized training expertise, and legitimate business
interests. If any restrictive covenant is held to be unenforceable because of
the scope, duration or geographic area, the parties agree that the court or
arbitrator may reduce the scope, duration, or geographic area, and in its
reduced form, such provision shall be enforceable. Should Employee violate the
provisions of Sections 4, 5, or 6, then in addition to all other remedies
available to the Company, the duration of these covenants shall be extended for
the period of time when Employee began such violation until Employee permanently
ceases such violation. Employee agrees that no bond will be required if an
injunction is sought to enforce any of the covenants previously set forth
herein.

The headings in this Agreement are inserted for convenience of
reference only and shall not control the meaning of any provision hereof.

This Agreement shall be governed in all respects by the
internal laws of the State of Minnesota without regard to conflict of law
provisions. Each of Employee and the Company hereby consents to the personal
jurisdiction of the state and federal courts located in Hennepin County,
Minnesota for any action or proceeding arising from or relating to this
Agreement or relating to any arbitration in which the parties are participants.
Any arbitration proceeding arising from or relating to this Agreement shall take
place in Hennepin County, Minnesota. 

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Upon full execution by all parties, this Agreement shall be
effective on the Effective Date set forth in Section 1. 

EMPLOYEE: 

	/s/ James P. Gratzek 	Date: 8-23-2016 
	James P. Gratzek 	 


COMPANY: 

	/s/ Michelle Coleman 	Date: 8-23-2016 
	Michelle Coleman 	 
	CHRO 	 


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