EXHIBIT 10.34
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement"), is entered into by and among
Xxxxxxx Xxxxxxx ("Executive"), and American Champion Entertainment
Inc., a Delaware corporation (the "Company"), effective as of the 25th
day of March, 1998.
In consideration of the mutual agreements set forth below, Executive
and the Company agree as follows:
1. EMPLOYMENT AS VICE PRESIDENT OF MARKETING OF THE COMPANY. The
Company does hereby employ Executive as Vice President of Marketing, of
the Company. Subject to the supervision and control of the President or
an assigned supervising executive of the Company, Executive shall do
and perform all services and acts necessary or advisable to fulfill the
duties and responsibilities of Vice President of Marketing, and shall
render such services on the terms set forth herein. In addition,
Executive shall have such other executive and managerial powers and
duties with respect to the Company and its subsidiaries as may
reasonably be assigned to her by the President or an assigned
supervising executive.
2. TERM OF AGREEMENT. The commencement date of this Agreement shall
be April 1, 1998, and shall continue for a period of one (1) year.
3. COMPENSATION.
3.1 Commission. The Company shall pay Executive a commission
rate of 10% for the total adjusted gross sponsorship dollars
("Adjusted Gross") raised for the television show "Adventures With
Xxxxx Xxxxx". Adjusted Gross shall be defined as total sponsorship
dollars raised less any additional costs incurred or agreements of
future costs to incur as a part of the sponsorship deal. (Example: NFL
sponsorship for $615,000.00 with the agreement that Mr. Montana will
provide his services for one TV commercial at the cost of $315,000.00
to be paid by the Company, then the Adjusted Gross would be
$300,000.00)
3.2 Draw. Executive shall be entitled to receive a draw against
future commissions in the amount of $7,825.00 monthly for three months
from the commencement date. In the event no sponsorship dollars are
raised in that time period, the Company shall have the right to 1)
terminate this agreement or 2) extend this agreement on a month to
month basis. In the event that the Adjusted Gross raised by Executive
is less than $500,000.00 by the end of the sixth month from the
commencement date, the Company shall have the right to either 1)
terminate this Agreement or 2) extend this agreement on a month to
month basis.
3.3 Options. In the event Executive raises $1,000,000.00 in
Adjusted Gross within twelve months of the commencement date, Executive
shall be granted at the time that this amount in contract is reached
and secured, the option to purchase five thousand (5,000) shares of
common stock of the Company at 100% of the closing price as of the date
of grant. Such option shall have a vesting period of one year from the
date of grant and is subject to the terms of the Options Plan of the
Company.
3.4 Additional Compensation. Executive shall be entitled
to additional commission compensation for additional revenue generating
items that are originated and completed by her. All additional
compensation categories must first be cleared by the Company due to
possible conflict of interests with other licensing arrangements and
other agreements that may have been already established. Each
compensation category shall have its own agreement with respect to its
individual terms and guidelines. (Example: foreign broadcast or a
motion picture deal.)
4. TERMINATION OF EXECUTIVE'S EMPLOYMENT.
4.1 Death In the event Executive's employment hereunder is
terminated by reason of Executive's death, the Company shall pay to
Executive's estate any amounts accrued hereunder to the date of death.
4.2 Disability. If, as a result of Executive's incapacity due
to physical or mental illness ("Disability") Executive shall have been
absent from the full-time performance of her duties with the Company
for a period of fifteen (15) days, within Three (3) days after written
notice is provided to her by the Company, she shall not have returned
to the full-time performance of her duties, Executive's employment
under this Agreement may be terminated by the Company for Disability.
During any period prior to such termination during which Executive is
absent from the full-time performance of her duties with the Company
due to Disability, the Company shall pay Executive any and all
commissions due.
4.3 Termination for Cause. The Company may immediately
terminate Executive's employment under this Agreement for "Cause" in
which case the Company shall have no further obligations hereunder,
except for payment of amounts of commission prorated to the date of
termination. "Cause" shall mean willful breach of this Agreement,
habitual neglect to perform or inability to perform in allotted time
Executive's duties hereunder, fraud, misappropriation, embezzlement, or
other criminal conduct.
5. Confidentiality. Executive shall not, except as may be required
to perform his duties hereunder or as required by applicable law,
disclose to others or use, whether directly or indirectly, any
Confidential Information regarding the Company. "Confidential
Information" shall mean information about the Company, its
subsidiaries and affiliates and their respective clients and customers
that was learned by Executive in the course of her employment by the
Company, including (without limitation) any proprietary knowledge,
trade secrets, financial information, client and customer lists and all
papers, and records (including computer records) containing such
Confidential Information. Executive acknowledges that such Confidential
Information is specialized, unique in nature and of great value to the
Company, and that such information gives the Company a competitive
advantage. At the Company's request, upon termination of this
Agreement, Executive agrees to return to the Company, any or all of
such Confidential Information.
6. NOTICES. All notices and other communications under this
Agreement shall be in writing and shall be given by fax or first class
mail, certified or registered with return receipt requested, and shall
be deemed to have been duly given three (3) days after mailing (at the
party's then current address), or twenty-four (24) hours after
transmission of a fax (at the party's then current fax number).
7. DISPUTE RESOLUTION: ATTORNEY'S FEES. The Company and Executive
agree that any dispute arising as to the parties' rights and
obligations hereunder, other than with respect to Section 5, shall be
resolved by binding arbitration before a private judge to be determined
by mutually agreeable means. Each party shall have the right in
addition to any other relief granted by such arbitrator (or by any
court with respect to relief granted with respect to Section 5), to
attorney's fees based on a determination by the arbitrator (or, with
respect to Section 5, the court) of the extent to which each party has
prevailed as to the material issues raised in determination of the
dispute.
8. TERMINATION OF PRIOR AGREEMENTS. This Agreement terminates and
supersedes any and all prior agreements and understandings between the
parties with respect to Executive's involvement with the Company and
compensation by the Company, particularly the agreement signed between
the parties on September 30, 1997.
9. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of California.
10. SEVERABILITY. In the event that a court of competent jurisdiction
determines that any portion of this Agreement is in violation of any
statue or public policy, only the portions of this Agreement that
violate such statute or public policy shall be stricken. All portions
of this Agreement that do not violate any statute or public policy
shall continue in full force and effect. Further, any court order
striking any portion of this Agreement shall modify the stricken terms
as narrowly as possible to give as much effect as possible to the
intentions of the parties under this Agreement.
11. COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all
of which together will constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its respective duly authorized officer, and the Executive
has hereunto signed this Agreement as of the date first above written.
Company: Executive:
AMERICAN CHAMPION ENTERTAINMENT, INC.
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx Xxxxxxx
Xxxxxxx X. Xxxx, President and CEO Xxxxxxx Xxxxxxx
Date: March 30, 1998 Date: March 30, 1998
AMENDMENT TO EMPLOYMENT AGREEMENT JULY 1, 1998
To: Xxxxxxx Xxxxxxx
000 Xxxx Xxxxxx
Xxxxxxx Xxxx XX 00000
Dear Xxxxxxx:
This letter serves as an amendment to the Employment Agreement dated
March 30, 1998. The changes below are effective July 1, 1998.
The terms of the March 30, 1998 Employment Agreement are amended as
follows:
2. TERM OF AGREEMENT. The commencement date of this Amendment to the
original Employment Agreement shall be July 1, 1998, and shall continue
for a period of two (2) years.
3. COMPENSATION.
3.1 Commission -
YEAR ONE (July 1, 1998 to June 30, 1999): The Company shall pay a
commission rate of 8% for the total adjusted gross sponsorship dollars
if PBS Coverage is below 70%. If PBS Coverage is 70% and above, the
commission rate will be 5%. The Company shall pay a commission rate of
5% for the net International Distribution Fee received.
YEAR TWO (July 1, 1999 to June 30, 2000): The Company shall pay a
commission rate of 8% for the total adjusted gross sponsorship dollars
raised if PBS Coverage is below 70%. If PBS Coverage is 70% and above,
the commission rate will be 5%. The Company shall pay a commission
rate of 5% for the net International Distribution Fee received.
If Executive ceases employment with the Company, any commission
due Executive subsequent to the date of termination, generated from
contracts during Executive's employment with the Company, will be
reduced to 50% of the above commission schedule for the first six
months after the termination date; and will be further reduced to 25%
of the above commission schedule for the second six months after the
termination date. Commission ceases after twelve months from the
termination date.
3.2 deleted
3.3 deleted
3.4 deleted
3.5 Basic Salary - The annual base salary shall be $93,900.00
per year beginning
July 1, 1998.
3.6 Stock Options - Options to purchase an additional (X)
shares of common stock
of the Company exercisable at the end of each 12 month
period beginning
July 1, 1998 at $6.5625 per share, subject to compliance
with applicable laws.
Sponsorship Revenue
generated during each
12 month period Value of (X)
a) up to $500,000 10,000
b) $501,000 to $1,000,000 15,000
c) above $1,000,000 20,000
The above terms are strictly for the defined periods only. Upon
reaching June 30, 2000, terms of the original Employment Agreement and
this amendment are to be renegotiated between the Company and Xxxxxxx
Xxxxxxx.
The remaining terms and conditions as outlined in the original
Employment Agreement continue to be in effect.
In Witness Whereof, the Company has caused this Agreement to be
executed by its respective duly authorized officer, and the Executive
has hereunto signed this Agreement as of the date first above written.
Company:
AMERICAN CHAMPION ENTERTAINMENT, INC.
By: /s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx, President & CEO
Accepted:
By: /s/ Xxxxxxx Xxxxxxx Date: July 1, 1998
Xxxxxxx Xxxxxxx
