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EXHIBIT 10(a)
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (this "Agreement") is made and
entered into effective as of the 17th day of August, 1998 (the "Effective
Date"), by and between Malibu Entertainment Worldwide, Inc., a Georgia
corporation (the "Company"), and Xxxxxxx X. Xxxxxxx (the "Executive").
R E C I T A L S:
A. The Company desires to provide for the employment of the Executive,
subject to the terms and conditions herein provided; and
B. The Executive is willing to commit himself to serve the Company in
the capacity hereinafter stated, subject to the terms and conditions herein
provided.
AGREEMENT:
NOW, THEREFORE, in consideration of the premises and the respective
covenants and agreements of the parties herein contained, and intending to be
legally bound hereby, the parties hereto hereby consent and agree as follows:
1. EMPLOYMENT. The Company hereby agrees to employ the Executive, and
the Executive hereby agrees to serve the Company, pursuant to the terms and
conditions set forth herein.
2. TERM. The initial term of employment of the Executive by the Company
pursuant to the terms of this Agreement will commence on the Effective Date
hereof (the "Commencement Date") and, subject to earlier termination pursuant to
Section 6, expire on the fourth annual anniversary thereof (the "Initial
Termination Date"). Notwithstanding the previous sentence, this Agreement and
the employment of the Executive will be automatically renewed, subject to
Section 6, for successive one-year periods upon the terms and conditions set
forth herein, commencing on the Initial Termination Date, and on each succeeding
fiscal year end of the Company thereafter, unless either party to this Agreement
gives the other party written notice of such party's intention to terminate this
Agreement and the employment of the Executive at least 30 days prior to the end
of such initial or extended term. For purposes of this Agreement, "Employment
Period" will include the initial term and any extension thereof. Following the
expiration of the Employment Period, Executive will be an "at will" employee of
the Company.
3. POSITIONS AND DUTIES. (a) During the Employment Period, the
Executive will be the President and Chief Executive Officer of the Company with
responsibility for the day-to-day direction and administration of the business
and affairs of the Company, subject, however, to legal limitations and to the
direction of the Board of Directors of the Company. At the Company's request,
the Executive will serve, without additional compensation, as an officer or
director, or both, of any subsidiary or affiliate of the Company or any other
entity in which the Company has an equity interest. If the Executive serves in
any such capacity, the Company will indemnify the Executive from liabilities in
connection with serving in any such capacity to the
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same extent as the Executive is indemnified in the performance of his duties as
an officer and director of the Company. In the event the Executive is
compensated for serving as an officer or director, or both, of any subsidiary,
division or affiliate of the Company or any other entity in which the Company
has an equity interest, such compensation will be deemed to be earned by the
Company and will be paid to the Company by the Executive. During the Employment
Period, Executive shall exercise his best efforts, and subject to the prior two
sentences, devote all of his full-time business and professional time,
attention, skill and efforts to the best interest of the Company and faithful
performance of his duties under this Agreement as they may be modified from time
to time. Executive's management of his personal affairs, service on behalf of
charitable organizations and performance of the duties of any political office
to which he is elected or appointed shall not constitute a breach of this
Agreement so long as such activities do not interfere with the efforts required
hereunder of the Executive toward the best interests of the Company or the
performance of the duties hereunder.
(b) The Company will use reasonable best efforts to cause the
Executive to be elected as a member of the Board of Directors of the Company
throughout the Employment Period and include the Executive in the management
slate for election as a director at each shareholders' meeting at which his term
as a director would otherwise expire. The Company will use reasonable best
efforts to cause the Executive to be appointed to serve as a member of the
Executive Committee of the Board of Directors of the Company for each year he is
elected as a director. As of the date hereof, the Board of Directors of the
Company has elected the Executive to the Board of Directors and appointed the
Executive to the Executive Committee, each conditioned only upon the Executive's
commencement of employment hereunder and effective as of the Effective Date. The
Executive acknowledges that no commitment has been made with respect to his
membership on the Board of Directors of Newco (as defined below).
(c) The Company has publicly announced a proposed transaction
(the "Combination") pursuant to which, among other transactions, the Company and
Xxxxxxxx'x Restaurant Group, Inc. ("Houlihan's") will become subsidiaries of a
newly formed holding company ("Newco"). The Executive will serve in such
capacities for Newco as Newco may from time to time request provided that such
service is not materially inconsistent with Executive's position and
responsibilities contemplated hereby.
4. COMPENSATION AND RELATED MATTERS. (a) ANNUAL BASE SALARY. During the
Employment Period, the Company shall pay the Executive an annual base salary
(the "Annual Base Salary") of $275,000, subject to increase or decrease with
respect to any calendar year beginning on or after January 1, 2000 as the Board
of Directors of the Company or, if the Combination occurs, of Newco or the
Compensation Committee thereof (together, the "Board") may determine in its sole
discretion, based on annual reviews. All payments of Annual Base Salary shall be
payable in substantially equal semi-monthly installments and, as nearly as
practicable, on the fifteenth and last days of each month in arrears. The
Company's compensation of the Executive by payments of the Annual Base Salary
pursuant to this Section 4(a) shall not be deemed exclusive and shall not
preclude the Executive from participating in any other compensation or benefit
plan of the Company, nor shall such compensation in any way limit or
reduce any other obligation of the Company hereunder; and no other compensation,
benefit or
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payment hereunder shall in any way limit or reduce the obligation of the Company
to pay the Executive's Annual Base Salary hereunder.
(b) BONUS. In addition to the Annual Base Salary set forth in
Section 4(a) hereof and any other amounts payable to the Executive under any
other provision of this Agreement, the Company shall pay to the Executive no
later than 10 days after the Executive executes this Agreement, a lump sum cash
payment of $11,600 and for the year ended December 31, 1998, the Company shall
pay the Executive no later than April 15, 1999, a lump sum cash payment of
$103,125. During the Employment Period for the calendar years beginning on or
after January 1, 1999, the Executive will be eligible to receive an annual
performance bonus in an amount up to 100% of the Executive's then-current Annual
Base Salary provided no Date of Termination has occurred on or prior to December
31st of the applicable calendar year (pro rated in the event of any partial
calendar year). Such annual bonus (the "Annual Bonus") will be determined by the
Board in its sole discretion after the end of each calendar year, based upon
performance objectives established by the Board after consultation with the
Executive relating to (i) achievement of budgetary goals, (ii) guest and
employee satisfaction levels, (iii) the achievement of organizational
objectives, and (iv) any other items established by the Board. The Annual Bonus
shall be payable in a lump sum in cash on April 15 of the following year (the
"Bonus Payment Date").
(c) EXPENSES. During Employment Period, the Company shall
promptly reimburse the Executive for all reasonable expenses incurred by the
Executive in performing services hereunder, including, but not limited to, all
expenses of travel and all living expenses while away from home on business or
at the request of and in the service of the Company, provided that all such
expenses are incurred and accounted for in accordance with the policies and
procedures established from time to time by the Company.
(d) OTHER BENEFITS. Except as otherwise provided in this
Agreement, during the Employment Period, Executive shall be entitled, pursuant
to the terms thereof, to full participation in all of the employee benefit plans
and arrangements maintained by the Company for its executives and key management
employees from time to time. Executive shall be entitled to paid vacation in
accordance with the Company's standard employment policies and practices for
executive employees, as the same may be in effect from time to time. Nothing
paid to the Executive under any plan or arrangement presently in effect or made
available in the future shall be deemed to be in lieu of the amounts payable to
the Executive pursuant to Sections 4(a) and 4(b) . All employee benefits and
arrangements provided under this Section 4(d) shall terminate concurrently with
the Date of Termination (as defined in Section 6(g) below) of the Executive's
employment under this Agreement for any of the circumstances set forth in
Section 6, unless provided for otherwise herein. Any payments or benefits
payable to the Executive under this subsection (d) in respect of any calendar
year during which the Executive is employed by the Company for less than the
entire year shall, unless otherwise provided in the applicable plan or
arrangement, be prorated in accordance with the number of days in such calendar
year during which the Executive is so employed.
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5. OPTIONS. The Company has concurrently herewith granted the Executive
non-qualified options to purchase 1,000,000 shares of Common Stock of the
Company, pursuant to an Agreement dated as of the date hereof.
6. TERMINATION. The Executive's employment hereunder may be terminated
without any breach of this Agreement under the circumstances set forth in this
Section 6. Section 7 of this Agreement sets forth the compensation to be paid to
the Executive upon termination of employment. In the event of any termination of
employment , the Executive's sole rights will be as provided in Section 7 hereof
and the company will have no other liabilities or obligations hereunder or
otherwise.
(a) TERMINATION UPON DEATH. The Executive's employment
hereunder shall terminate automatically upon his death.
(b) TERMINATION UPON DISABILITY. If the Company determines in
good faith that the Disability of the Executive has occurred pursuant to the
definition of "Disability" set forth below, the Company may give the Executive
written notice of its intention to terminate the Executive's employment. If the
Company delivers written notice to the Executive pursuant to the preceding
sentence, and the Executive shall have been continuously absent from his duties
hereunder on a full-time basis for substantially the entire period of one
hundred eighty (180) days during any twelve-month period, and within thirty (30)
days after written notice of termination is received by the Executive (which
receipt shall occur after the expiration of such one hundred eighty (180)-day
period), the Executive shall not have returned to full-time performance of his
duties hereunder, then the Executive's employment hereunder shall terminate
effective on the 30th day after such notice of termination is received by the
Executive. For purposes of this Agreement, "Disability" means incapacity of the
Executive due to physical or mental illness which renders the Executive
incapable, in the judgment of the Board, of performing the essential functions
of his job with or without accommodation.
(c) TERMINATION BY THE COMPANY FOR CAUSE. The Company may
terminate the Executive's employment hereunder when Cause exists. For purposes
of this Agreement, "Cause" shall mean that the Board shall have determined that
any of the following acts or events have occurred:
(i) the Executive shall have been convicted of or
admitted or pled nolo contendre to an act of fraud, theft or dishonesty
or any other crime or offense involving moral turpitude or likely to
affect adversely the Company or its assets, operations, prospects or
goodwill; or
(ii) the Executive shall harass any employee of the
Company based on race, age, sex, religion, color, national origin or
other factor prohibited by law; or
(iii) the Executive shall violate or breach any of
the terms and provisions of Sections 8(a), 8(b), 12 or 16 of this
Agreement; or
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(iv) the repeated failure by the Executive to
substantially perform his obligations and responsibilities under this
Agreement (other than any such failure resulting from the Executive's
incapacity due to physical or mental illness), and which is not
remedied within fifteen (15) days after a Notice of Termination is
received by the Executive that specifically identifies the manner in
which the Company in good faith believes that the Executive has
repeatedly failed to substantially perform his obligations under this
Agreement.
The Company may suspend the Executive's employment under this
Agreement, with or without continuation of compensation provided otherwise to be
paid hereunder, for such period of time as the Board may deem appropriate if the
Executive is arrested, indicted or otherwise accused in a criminal proceeding or
an internal investigation relating to any act listed in (i) or (ii) of this
subsection (c).
(d) OTHER TERMINATION BY THE COMPANY. In addition to the
foregoing, the Company may terminate the Executive's employment under this
Agreement for any other reason or for no reason at any time upon giving Notice
of Termination to the Executive.
(e) TERMINATION BY THE EXECUTIVE.
(i) The Executive may terminate his employment
hereunder for any reason, including for Good Reason. For purposes of
this Agreement, "Good Reason" shall exist if within six months after
the occurrence of a Change of Control the Executive is assigned to
duties at the Company or Newco inconsistent in any material respect
(unless in the nature of a promotion) with the Executive's position in
the Company immediately prior to such change (including, but not
limited to, the Executive's status, offices and titles), or a
significant adverse alteration or diminution in the nature or status of
the Executive's authority, duties or responsibilities from those in
effect immediately prior to such change, other than an isolated,
insubstantial and inadvertent action that is fully corrected within ten
(10) days after receipt of written notice from the Executive; provided,
however, that Good Reason will not exist and the Executive will not be
entitled to the payments pursuant to Section 7(e) if effective
immediately following a Change of Control of the Company, Newco or an
operating subsidiary thereof expressly assumes the obligations of the
Company set forth in this Agreement and Newco offers the Executive a
comparable position of employment with Newco or such operating
subsidiary.
(ii) For the purposes of this Agreement, a "Change of
Control" shall mean any "person" or "group" (within the meaning of
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), other than a Hampstead Affiliate or, as
to the Company if the Combination occurs, Newco becomes the beneficial
owner (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of 50% or more of the combined voting power of the Company's or
Newco's then-outstanding voting securities entitled to vote generally
in the election of directors ("Voting Stock"), whether directly by a
stock purchase or indirectly through a merger, consolidation,
recapitalization or similar transaction, provided, however, that no
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event will constitute a "Change of Control" until such time as
Hampstead Affiliates have sold for cash or cash equivalents at least
50% of the Voting Stock (or, if applicable, the securities into which
Voting Stock is converted in any merger, consolidation,
recapitalization or similar transaction) owned by them as of, if the
Combination does not occur, the date hereof, or if the Combination does
occur, the date on which the Combination is effected and (B) "Hampstead
Affiliate" means, collectively, The Hampstead Group L.L.C., HR Funding,
L.P., HR Interests, L.L.C. and any person that directly, or indirectly,
through one or more intermediaries, controls or is controlled by, or is
under common control with, Hampstead Group L.L.C., HR Funding L.P. or
HR Interests L.L.C. and for purposes of the definition of "Hampstead
Affiliate", in addition to any other circumstances in which control
with respect to a Hampstead Affiliate exists, control with respect to a
Hampstead Affiliate will be deemed to exist through beneficial
ownership of 30% or more of a person's voting securities.
(f) NOTICE OF TERMINATION. Any termination of the Executive's
employment by the Company or by the Executive (other than termination pursuant
to subsection (a) hereof) shall be communicated by written Notice of Termination
to the other party. For purposes of this Agreement, a "Notice of Termination"
shall mean a notice which (i) indicates the specific termination provision in
this Agreement relied upon, (ii) sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) if the Date of Termination
(as defined in Section 6(g)) is other than the date of receipt of such notice,
specifies the Date of Termination (defined below).
(g) DATE OF TERMINATION. "Date of Termination" shall mean (i)
if the Executive's employment is terminated by his death, the date of his death,
(ii) if the Executive's employment is terminated pursuant to subsection (b)
hereof (relating to disability), 15 days after Notice of Termination is received
by the Executive (provided that the Executive shall not have returned to the
performance of his duties on a full-time basis during such 15-day period), (iii)
if the Executive's employment is terminated by the Executive for any other
reason, five days after receipt of the Notice of Termination, and (iv) if the
Executive's employment is terminated for any other reason, the date specified in
the Notice of Termination.
7. COMPENSATION UPON TERMINATION. (a) TERMINATION UPON DEATH. If the
Executive's employment is terminated by reason of his death, the Company shall
(i) pay the Executive all salary payments accrued through the Date of
Termination and then unpaid and (ii) pay to the Executive in accordance with
Section 4(b) the Annual Bonus to be determined in accordance with Section 4(b),
prorated to the Date of Termination but without accelerating the Bonus Payment
Date. The accrued, but unpaid salary portion of such compensation shall be paid
to the Executive or the Executive's estate within 15 days after the Date of
Termination. Other than the foregoing, the Company shall have no further
obligations to the Executive under this Agreement in the case of the termination
of the Executive's employment by reason of death or Disability.
(b) TERMINATION UPON DISABILITY. Notwithstanding any provision
herein to the contrary, during any portion of the Employment Period that the
Executive fails to perform his duties hereunder as a result of incapacity due to
physical or mental illness ("Disability Period"),
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the Executive shall continue to receive his base salary at seventy percent (70%)
of the rate then in effect less any sums payable to the Executive under any
disability insurance plan or policy of the Company then in effect until the
Executive's employment is terminated pursuant to Section 6(b). If the
Executive's employment is terminated by reason of Disability of the Executive as
set forth in Section 6(b) hereof, the Company shall (i) pay to the Executive all
salary payments accrued through the Date of Termination and then unpaid, (ii)
continue to pay to the Executive for a period of one (1) year following such
Date of Termination the Executive's base salary at seventy percent (70%) of the
rate in effect at such Date of Termination less any sums payable to the
Executive under any disability insurance plan or policy of the Company then in
effect and (iii) pay to the Executive in accordance with Section 4(b) the Annual
Bonus to be determined in accordance with Section 4(b), prorated to the Date of
Termination but without accelerating the Bonus Payment Date. The accrued but
unpaid salary portion of such compensation shall be paid to the Executive in
lump sum in cash within thirty (30) days of the Date of Termination. Other than
the payment of such compensation provided for in this subsection, the Company
shall have no further obligations to the Executive under this Agreement in the
case of termination for Disability.
(c) TERMINATION FOR CAUSE. If the Executive's employment shall
be terminated prior to the end of the Employment Period (i) at any time when
Cause exists or (ii) by the Executive for any reason other than Good Reason, the
Company shall pay the Executive all salary payments accrued through the Date of
Termination and then unpaid but Executive shall not be entitled to receive any
severance benefits whatsoever even if such benefits are generally made available
by the Company to its resigning or terminated executives or key management
employees. Other than the payment of such compensation provided for in this
subsection, the Company will have no further obligation to the Executive under
this Agreement in the case of a termination of employment referred to in this
subsection.
(d) TERMINATION OTHER THAN FOR CAUSE, DEATH OR DISABILITY. If
(A) the Executive's employment shall be terminated by the Company hereunder in
circumstances to which none of Sections 7(a), (b), (c) or (e) apply, then
(i) the Company shall continue to pay the Executive
his Annual Base Salary through the Date of Termination;
(ii) for a period commencing on the Date of
Termination and ending on the second anniversary thereof (such period,
the "Two-Year Severance Period"), the Executive will receive annually
an amount equal to (A) if the Date of Termination occurs after December
31, 2000, the average of the Annual Base Salary plus the Annual Bonus
paid for each of the prior two calendar years, (B) if the Date of
Termination occurs on or before December 31, 2000 but after December
31, 1999, the Annual Base Salary plus the Annual Bonus paid to the
Executive for the calendar year 1999, and (C) if the Date of
Termination occurs on or before December 31, 1999, the Annual Base
Salary then in effect plus $150,000. Such payments will be made in
substantially equal semi-monthly installments and, as nearly as
practicable, on the fifteenth and last days of each month in arrears,
provided however, if the Company so elects, such payments may be paid
in a
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lump sum equal to the present value (calculated using a 9% discount
rate) of such periodic payments.
(iii) for the Two-Year Severance Period, the Company
will continue to provide the Executive with the welfare benefits that
he was receiving from the Company immediately prior to the Date of
Termination on the same terms and conditions (including employee
contributions toward the premium payments) under which the Executive
was entitled to participate immediately prior to the Date of
termination. Such benefits may be modified or terminated by the Company
following the Date of Termination provided such change is applicable to
senior executives of the Company generally and the Company's obligation
to provide benefits pursuant to this subsection will terminate when the
Executive commences any other employment during the TwoYear Severance
Period.
Other than the payment of the compensation and severance provided for in (i) and
(ii) of this subsection (d), the Company shall have no further obligation to the
Executive under this Agreement in the case of a termination of employment
referred to in this subsection (d).
(e) TERMINATION UPON GOOD REASON OR CHANGE OF CONTROL. If the
Executive shall terminate his employment for Good Reason or the Company
terminates his employment within six months of a Change of Control at a time
when Cause does not exist, then
(i) the Company shall continue to pay the Executive
his Annual Base Salary through the Date of Termination; and
(ii) in lieu of any further salary payments or other
benefits to the Executive for periods subsequent to the Date of
Termination, the Company shall pay as severance pay to the Executive a
lump sum severance payment in an amount equal to two times the
Executive's then-current Annual Base Salary. Such payment to be made
within 10 calendar days following the Termination Date; provided,
however, the severance payments provided to be made by this subsection
shall be reduced dollar for dollar by the pretax amount of any
compensation or income earned or received by Executive for services
rendered or advice given by him to others, including, without
limitation, compensation or income earned or received as the result of
employment or consulting services during the severance pay periods
provided for in this subsection. Upon request, Employee will provide
the Company with such information and documentation as the Company may
reasonably request in order to confirm the amount of such other
compensation or income;
Other than the payment of the compensation and severance provided for in (i) and
(ii) of this subsection (e), the Company shall have no further obligation to the
Executive under this Agreement in the case of a termination of employment
referred to in this subsection (e).
(f) LIMITATION ON PAYMENTS. Other than payments specifically
provided for in this Section 7, the Company will have no further obligation to
the Executive upon termination of the Executive's employment for any reason
whether by the Company or the Executive.
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(g) ENTITLEMENT TO OFFSET. The Company shall be entitled to
offset any amounts owing by Executive to Company, whether under this Agreement
or otherwise, against any payments provided for in this Agreement to be made by
the Company to the Executive. The Executive or, if applicable, his estate or
other legal representatives shall, as a condition to the Executive's right to
receive the compensation and severance pay provided for by subsections (d) and
(e) above, execute and deliver to the Company a release and discharge of the
Company and its Affiliates and all persons in privity with them from any and all
claims or causes of action, of any kind whatsoever, federal or state, at common
law, statutory, or otherwise which the Executive or his estate or legal
representatives had, may then have or in the future may have against the Company
and its Affiliates and all persons in privity with them, known or unknown,
directly or indirectly related to the Executive's employment by the Company or
the termination of such employment, including, but not limited to, claims under
applicable workers compensation acts, human rights acts, Title VII of Civil
Rights Act of 1964 as amended, the Age Discrimination in Employment Act, and the
Americans With Disabilities Act. Such release shall in form and substance be in
compliance with applicable law and shall be conditioned upon the receipt by the
Executive or his estate or other legal representatives of such severance
payments.
(h) LIMITATION ON PARACHUTE PAYMENTS. Anything in this
Agreement to the contrary notwithstanding, if it shall be determined that any
payment or distribution by the Company or any of its affiliates to or for the
benefit of the Executive hereunder would be subject to the excise tax (the
"Excise Tax") imposed by Section 4999 of the Internal Revenue Code of 1986 (the
"Code") (or any successor provision thereto) but for the application of this
Section 7(h), then the payments and benefits to be provided hereunder will be
reduced to the minimum extent necessary so that no portion thereof shall be
subject to Excise Tax but only if by reason of, and giving effect to such
reduction, the Executive's net after-tax benefit will exceed the Executive's net
after-tax benefit if such reduction were not made. In the event that any
reduction is required by this Section 7(h) in the payments and benefits
hereunder, such reduction will first be made in the payments to be received
under Section 7(c).
8. NONCOMPETITION; CONFIDENTIAL INFORMATION (a) During the Employment
Period and for a period of two (2) years following the expiration of the
Employment Period or, if sooner, the Date of Termination of employment of
Executive under this Agreement, Executive shall not engage in any Competitive
Activity. For purposes of this Agreement, the term "Competitive Activity" means
the Executive's participation, without the written consent of the Board of
Directors of the Company, in the management of any business enterprise, over 25%
of the gross revenue for the immediately preceding fiscal year of which was
derived from operations in the racing-based, theme or family park business or
any other business carried on by the Company at the Date of Termination in which
the Company competes or in which the Company intends to compete pursuant to a
business plan or other plan of action adopted by the Company (formally or
informally) prior to the Date of Termination. Notwithstanding the foregoing, the
restrictions in this Section 8(a) shall (i) apply for a one (1) year period
instead of two (2) years if the Executive terminates his employment for Good
Reason or if the Company terminates the Executive's employment within six months
after a Change of Control.
(b) Executive hereby acknowledges that he has and will
continue to have access to confidential and proprietary information of the
Company and its Affiliates (including,
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but not limited to, pricing strategies, program materials, financial statements
and results, employee lists, terms of agreements between the Company and
employees, customers and suppliers, marketing methods and concepts, development
ideas and strategies, personnel training and development programs, proprietary
computer and systems software, proprietary data and strategic business plans)
and that such information constitutes valuable, special and unique property of
the Company and its Affiliates. The Executive agrees not to use (except in the
course of the performance of his duties hereunder) or disclose, either while in
the Company's employ or following termination of his employment with the Company
for any reason, to any person not employed on a full-time basis by the Company
or its Affiliates, or not engaged to render services to the Company or its
Affiliates, except with the prior written consent of an officer authorized to
act in the matter by the Board of Directors of the Company, any such
confidential and proprietary information of the Company, provided, however, that
this provision shall not preclude the Executive from the use or disclosure of
information known generally to the public or from disclosure required by law or
court order. If Executive becomes legally compelled to disclose any confidential
information, Executive will provide the Company with prompt notice thereof so
that the Company may seek a protective order or other appropriate remedy, and
Executive shall cooperate with the Company in that effort. If such protective
order or other remedy is not obtained, Executive will (i) furnish that portion
of the confidential information that Executive is advised by written opinion of
the counsel is legally required, and (ii) exercise his best efforts to obtain
reliable assurance that confidential treatment will be accorded to such
information. The agreement made in this Section 8(b) shall be in addition to,
and not in limitation or derogation of, any obligations otherwise imposed by law
or by separate agreement upon the Executive in respect of confidential
information of the Company.
(c) It is acknowledged and agreed by Executive and Company
that the covenants contained in this Section 8 are reasonable as to time, area,
scope and/or necessary to protect the Company and its business. Nevertheless, it
is further agreed that such covenants shall be regarded as divisible and shall
be operative as to time, area and scope to the extent that it may be so
operative, and if any part of the covenants are declared invalid or
unenforceable as to time, area or scope, the validity or enforceability of the
remainder shall not be affected.
(d) In the event of a breach or a threatened breach by
Executive of any provisions of this Section 8, Company shall be entitled to
injunctive relief restraining Executive from breaching such provisions. Nothing
herein shall prohibit the Company from pursuing any other remedy available to it
for such breach or threatened breach, including the recovery of damages from
Executive.
9. SUCCESSORS AND BINDING AGREEMENT. This Agreement will be binding
upon and inure to the benefit of and be enforceable by the Company and any
successor to the Company, but will not otherwise be assignable, transferable or
delegable by the Company. This Agreement and all rights of the Executive
hereunder shall, subject to the terms and conditions hereof, inure to the
benefit of and be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive should die while any amounts would still
be payable to him hereunder if he had continued to live, all such amounts,
unless otherwise provided herein, shall be paid subject to and in accordance
with the terms and conditions of this Agreement to the Executive's devisee,
legatee, or other
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designee or, if there be no such designee, to the Executive's estate. This
Agreement is personal in nature and neither of the parties hereto may, without
the consent of the other, assign, transfer or delegate this Agreement or any
rights or obligations hereunder except as expressly provided herein. Without
limiting the generality or effect of the foregoing, the Executive's right to
receive payments hereunder will not be assignable, transferable or delegable,
whether by pledge, creation of a security interest, or otherwise, other than by
a transfer by the Executive's will or by the laws of descent and distribution
and, in the event of any attempted assignment or transfer contrary to this
Section 9, the Company will have no liability to pay any amount so attempted to
be assigned, transferred or delegated.
10. NOTICE. For the purposes of this Agreement, notices, demands and
all other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given when delivered or (unless otherwise
specified) mailed by United States (certified mail, return receipt requested,
postage prepaid), addressed as follows:
If to the Executive: Xxxxxxx X. Xxxxxxx
If to the Company: Malibu Entertainment Worldwide, Inc.
000 Xxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Chief Financial Officer
with copy to: The Hampstead Group, L.L.C.
0000 Xxxxx Xxxxxxxx Xxxxx Xxxx
0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxx Xxxxx
Fax No. (000) 000-0000
or to such other address as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
11. REPRESENTATION BY COUNSEL. Executive acknowledges that he has
sought and obtained separate and independent legal counsel as to the negotiation
of this Agreement and Executive's agreement with its terms and provisions and
that Executive, with advice of such counsel, has carefully read and reviewed all
the terms and conditions of this Agreement and that Executive executes and
delivers this Agreement voluntarily because of the rights and benefits granted
to Executive hereunder.
12. NO CONFLICTING AGREEMENTS. Executive represents and warrants to the
Company that Executive is not a party to any agreement, contract or covenant
limiting the freedom of Executive (or any company employing Executive) to
perform the services contemplated herein. Executive further represents and
warrants to the Company that Executive is not a party to any agreement, contract
or covenant imposing upon Executive or his employer any duty with respect
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to confidential or proprietary information or with respect to the solicitation
or hiring of any person that would be applicable to the Company as presently
operated. Executive further represents and warrants to the Company that the
execution, delivery and performance of this Agreement by Executive and the
current operations of the Company do not and will not conflict with, or
constitute a breach or default under, or give rise to any right of termination,
cancellation or acceleration under, any term or provision of any contract,
agreement or other instrument or obligation to which Executive is a party or by
which Executive is bound. The Executive agrees that he is not entitled to
indemnification from the Company pursuant to the Company's bylaws or any other
agreement or to coverage under any insurance policy providing for coverage of
claims against officers or directors of the Company in the event of any claim,
action or proceeding being brought against the Executive by reason of the
existence of any agreement, contract, instrument or other obligation which would
cause a breach or inaccuracy of the representations and agreements of Executive
contained in this Section 12 or by reason of the Company asserting a claim for
indemnity under this Section 12 against the Executive.
13. MISCELLANEOUS. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and such other executive officer of the
Company as may be specifically designated by the Board of Directors of the
Company. No waiver by either party hereto at any time of any breach by the other
party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement. The validity,
interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Delaware without regard to its conflicts of law
principles. In the event of a lawsuit by any party to enforce the provisions of
this Agreement, the prevailing party shall be entitled to recover reasonable
costs, expenses and attorney's fees from the other party. Executive and the
Company shall execute and deliver to one another such other agreements as may be
reasonably necessary or appropriate to comply with the purposes and intent of
this Agreement.
14. VALIDITY. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.
15. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
16. NONSOLICITATION. During the Employment Period and for a period of
two (2) years following the expiration of the Employment Period or, if sooner,
the Date of Termination of employment of Executive under this Agreement,
Executive shall not (1) solicit to hire any person who is employed by the
Company or any Affiliate (or who was employed by the Company or any Affiliate
within a period of one year prior to the expiration or termination of employment
of Executive) or (2) encourage such a person to leave the employment of the
Company or any Affiliate or (3) assist or provide information in connection with
any party's soliciting or hiring of
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or consideration of employment of such persons. Notwithstanding the foregoing,
the restrictions in this Section 16 shall (i) apply for a one (1) year period
instead of two (2) years if the Executive terminates his employment for Good
Reason or if the Company terminates the Executive's employment within six months
after a Change of Control other than for Cause or death or Disability or the
Executive terminates his employment after the end of the Employment Period.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date and
year first above written.
MALIBU ENTERTAINMENT WORLDWIDE, INC.
By:
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Name:
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Title:
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EXECUTIVE
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Xxxxxxx X. Xxxxxxx
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