EXHIBIT 10.7
EMPLOYMENT AGREEMENT
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Agreement, dated as of October 21, 1995, between SONY THEATRE MANAGEMENT
CORP., a Delaware Corporation which maintains offices at 000 Xxxxx Xxx., Xxx
Xxxx, XX 00000 (the "Company") and XXXXXX XXXX ("Employee"), residing at 0 Xxx
Xxxxx Xxxxxx Xxxx, Xxxxx Xxxxxx Xxxxx, Xxx Xxxxxx 00000.
The parties hereby agree as follows:
1. TERM OF EMPLOYMENT.
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The Company hereby employs Employee, and Employee hereby accepts
employment, on the terms and subject to the conditions hereinafter set forth,
for a term (the "Employment Period") commencing on October 21, 1995 and
continuing until October 20, 1999 (the "Expiration Date").
2. DUTIES AND PRIVILEGES.
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During the Employment Period, Employee shall serve as Executive Vice
President of the Company, be responsible to and report to the Chairman of the
Company or to such other person or persons as may be designated by the Chairman
of the Company (the person to whom Employee reports is herein called the
"Supervisory Officer"); perform such services consistent with Employee's
position hereunder as the Supervisory Officer may from time to time require;
devote Employee's entire business time, ability and energy exclusively to the
performance of Employee's duties hereunder; and use Employee's best efforts to
advance the interests and businesses of the Company, its divisions, subsidiaries
and affiliates. If Employee's performance is satisfactory to the Supervisory
Officer, the Supervisory Officer shall recommend to the Board of Directors of
the Company that Employee be elected President of the Company on or about
October 21, 1996.
3. COMPENSATION.
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(a) Upon the execution and delivery of this Agreement, the Company
shall pay Employee a bonus of $25,000.
(b) The Company shall pay to the Employee an annual salary at the
rates and for the periods as follows:
Period Annual Salary
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October 21, 1995-October 20, 1997 $ 350,000
October 21, 1997-October 20, 1999 400,000
(c) (i) During the Employment Period, Employee shall be eligible to
participate in all then-operative employee benefit plans of Sony Pictures
Entertainment ("SPE") or its affiliates which are applicable generally to the
Company's executives of comparable rank to Employee ("Employee Benefit Plans"),
subject to the respective terms and conditions of such
Employee Benefit Plans. Nothing contained in this Agreement shall obligate the
Company to adopt or implement any Employee Benefit Plan, or prevent or limit the
Company from making any blanket amendments, changes, or modifications of the
eligibility requirements or any other provisions of, or terminating, any
Employee Benefit Plan at any time (whether during or after the Employment
Period), and Employee's participation in or entitlement under any such Employee
Benefit Plan shall at all times be subject in all respect thereto.
(ii) Employee shall be eligible to receive a bonus each year,
the amount and timing of such bonus shall be determined by the Company.
(iii) Anything herein to the contrary notwithstanding, the
Company agrees that during the Employment Period, payments to the Employee
pursuant to subparagraphs (i) and (ii) immediately above shall not be less than
$400,000, and if there is a deficiency, the Company shall pay to the Employee,
the amount of such deficiency immediately prior to the Expiration Date.
(d) To facilitate Employee's performance of Employee's duties
hereunder, the Company shall make available to Employee, during the Employment
Period, either a leased automobile or car allowance. In the event Employee
elects to lease an automobile, the Company shall provide Employee with an
automobile allowance to lease such automobile which shall not exceed $1200 a
month during the first and second years of the Employment Period and shall not
exceed $1500 a month during the third and fourth years of the Employment Period,
and in such event, the Company shall also pay for and provide parking for
Employee near the Company's office. In the event Employee elects a car
allowance, the amount thereof shall be $1300 a month during the first and
second years of the Employment Period and $1600 a month during the third and
fourth years of the Employment Period, and in such event, the Company shall not
pay for or provide any parking for the Employee.
4. EXPIRATION OF TERM AND TERMINATION.
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(a) Employee's employment by the Company and this Agreement shall
automatically expire and terminate on the Expiration Date unless sooner
terminated pursuant to the provisions of this Section 4.
(b) Employee's employment by the Company and this Agreement shall
automatically terminate upon Employee's death.
(c) The Company shall have the right and option, exercisable by
giving written notice to Employee, to terminate Employee's employment by the
Company and this Agreement at any time after Employee has been unable to perform
the services or duties required of Employee in connection with Employee's
employment by the Company as a result of physical or mental disability (or
disabilities) which has (or have) continued for a period of twelve (12)
consecutive weeks, or for a period of sixteen (16) weeks in the aggregate,
during any twelve month (12) period.
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(d) The Company shall have the right and option exercisable by giving
written notice to Employee, to terminate Employee's employment by the Company
and this Agreement at any time after the occurrence of any of any of the
following events or contingencies (any such termination being deemed to be a
termination "for cause"):
(i) Employee materially breaches, materially repudiates or
otherwise materially fails to comply with or perform any of the terms of this
Agreement, any duties of Employee in connection with Employee's employment by
the Company or any of the Company's policies or procedures, or deliberately
interferes with the compliance by any other employee of the Company with any of
the foregoing;
(ii) The commission by Employee of a felony (whether or not
prosecuted) or the pleading by Employee of no contest (or similar plea) to any
felony (other than a crime for which vicarious liability is imposed upon
Employee solely by reason of Employee's position with the Company, and not be
reason of Employee's conduct);
(iii) Failure by Employee to perform his duties hereunder at a
level satisfactory to the Company, after written notice thereof to Employee and
ten business days opportunity to cure; or
(iv) Any other act, omission, event or condition constituting
cause for the discharge of any employee under applicable law.
(e) The Company shall have no obligation to renew or extend the
Employment Period. Neither (i) the expiration of the Employment Period, (ii)
the failure or refusal of the Company to renew or extend the Employment Period,
this Agreement, or Employee's employment by the Company upon the Expiration Date
nor (iii) the termination of this Agreement by the Company pursuant to any
provision of this Section 4 [except Section 4(g)], shall be deemed to constitute
a termination of Employee's employment by the Company "without cause" for the
purpose of triggering any rights of or causes of action by Employee.
(f) If this Agreement, the Employment Period or Employee's employment
by the Company is terminated or expires pursuant to any provision of this
Section 4 [other than Section 4(g)], or is terminated by Employee, Employee's
rights to receive salary or other compensation from the Company and all other
rights and entitlement of Employee pursuant to this Agreement or as an employee
of the Company shall forthwith cease and terminate, and the Company shall have
no liability or obligation whatsoever to Employee, except that:
(i) The Company shall be obligated to pay to Employee not later
than the effective date of such termination all unpaid salary, car allowance (if
any), vacation and reimbursable expenses which shall have accrued as of the
effective date of such termination: and
(ii) The terms and conditions of applicable Employee Benefit
Plans, if any,
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shall control Employee's entitlement if any, to receive benefits thereunder.
(g) The Company shall not be obligated to utilize Employee's services
or any of the results and proceeds thereof or to permit Employee to retain any
corporate office or to continue to do so; and the Company shall have the
unilateral right, at any time, without notice, in the Company's sole and
absolute discretion, to terminate Employee's employment by the Company, without
cause and for any reason or for no reason (the Company's "Termination Rights").
The Company's Termination Rights are not limited or restricted by, and shall
supersede any policy of the Company requiring or favoring continued employment
of its employees during satisfactory performance, any seniority system or any
procedure governing the manner in which the Company's discretion is to be
exercised. No exercise by the Company of its Termination Rights shall, under any
circumstances, be deemed to constitute (i) a breach by the Company of any term
of this Agreement, express or implied (including without limitation a breach of
any implied covenant of good faith and fair dealing), (ii) a wrongful discharge
of Employee or a wrongful termination of Employee's employment by the Company,
(iii) a wrongful deprivation by the Company of Employee's corporate office (or
authority, opportunities or other benefits relating thereto) or (iv) the breach
by the Company of any other duty or obligation, express or implied, which the
Company may owe to Employee pursuant to any principle or provision of law
(whether contract or tort). If the Company elects to terminate Employee's
employment by the Company without cause prior to the Expiration Date, the
Company shall have no obligation or liability to Employee pursuant to this
Agreement or otherwise, except to pay to Employee until the Expiration Date
amounts equal to the salary and benefits provided in Sections 3(a) and 3(b)
hereof (excluding car allowance or car leasing programs, if any), payable in the
same installments and on the same dates as if Employee's employment by the
Company had not been terminated; provided, however, that immediately upon any
termination of Employee's employment by the Company and continuing until the
Expiration Date, Employee shall use Employee's best efforts to obtain other
employment and to pursue other business activities, at a comparable level, and
any amounts otherwise payable pursuant to this Section 4 shall be reduced by all
amounts (whether direct or indirect salary, compensation or otherwise) earned by
Employee from such other employment or business activities prior to the
Expiration Date. Employee shall advise the Company on an ongoing basis of the
efforts being undertaken by Employee to obtain other employment or business
activities and shall promptly notify the Company, in writing, of all such other
employment or business activities undertaken by Employee and the salary,
compensation or other amounts received or to be received by Employee therefrom.
(h) Immediately upon any termination of Employee's employment
hereunder or of this Agreement (whether or not pursuant to this Section 4),
Employee shall return to the Company all property of the Company heretofore
provided to Employee by the Company, or otherwise in the custody, possession or
control of Employee (including, without limitation, the "Confidential Materials"
described in Paragraph 6(b) of Exhibit A attached hereto). Notwithstanding any
provision of this Agreement to the contrary, no termination of this Agreement or
of Employee's employment for any reason whatsoever shall in any manner operate
to terminate, limit or otherwise affect the Company's ownership of any of the
rights, properties or privileges granted to the Company hereunder.
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5. CODE OF BUSINESS CONDUCT.
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Employee acknowledges that Employee has received and reviewed the Code of
Business Conduct of SPE and has completed and returned a signed copy thereof.
6. STANDARD TERMS.
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Attached as Exhibit A hereto and deemed a part hereof are the Company's
Standard Terms and Conditions of Employment Agreement, all of which terms are
binding on the parties hereto and incorporated herein. For convenience,
provisions of this Agreement shall be referred to as "Sections" and provisions
of the Standard Terms shall be referred to as "Paragraphs". In the case of any
conflict between the terms of this Agreement and the terms of Exhibit A hereto,
the terms of this Agreement shall govern.
7. SUPERSEDING AGREEMENT.
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This Agreement shall constitute the full and entire understanding of
the parties hereto with respect to the subject matter hereof. The prior
Employment Agreement made between the parties dated October 21, 1991, as
amended, is hereby terminated as of October 20, 1995, and this Agreement
supersedes any prior agreement made between the parties.
/s/ Xxxxxx Xxxx
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XXXXXX XXXX
SONY THEATRE MANAGEMENT CORP.
By:/s/ Xxxxxx Xxxxxx Xxxxx
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Xxxxxx Xxxxxx Xxxxx, Chairman
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