Exhibit 10.15
December 2, 2002
F. Xxxxx Xxxxx
00 Xxx Xxxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Re: Amended and Restated Employment Agreement dated July 19, 1999
Dear Xxxxx:
On behalf of Marvel Enterprises, Inc. (hereinafter the "Company"), I am pleased
to confirm in this letter agreement (the "Agreement") that your employment with
the Company will continue on a part-time basis effective January 1, 2003 (the
"Effective Date") and shall terminate on or before December 31, 2004 (the
"Scheduled Expiration Date"), as set forth below. The Scheduled Expiration Date
shall be automatically postponed for one year, and your employment shall be
automatically extended by one year, unless either party hereto provides the
other party with written notice (a "Notice of Nonrenewal"), not later than sixty
days prior to the Scheduled Expiration Date, of its election not to permit your
employment to be so extended, and the Scheduled Expiration Date shall thereafter
be automatically postponed for one additional year and your employment shall
thereafter be automatically extended by one additional year, on each subsequent
anniversary of the Scheduled Expiration Date, unless either party provides the
other party with written notice, not later than sixty days prior to such
subsequent anniversary of the Scheduled Expiration Date of this Agreement, of
its election not to permit your employment to be so extended. It is understood
and agreed that this Agreement is intended to constitute an Amendment and
Restatement of the Employment Agreement between the Company and you dated July
19, 1999, effective as of the Effective Date. The "Term" of your employment is
hereby revised to mean the period form the date hereof until the Scheduled
Expiration Date, unless sooner terminated pursuant to Section 3 below.
1. POSITION AND DUTIES.
On the Effective Date, you will cease to be a regular full time
employee of the Company but you will continue to be employed by the
Company as an employee in a part time special assignment position,
with the title of Special Advisor to the Chief Executive Officer
("CEO")or his successor (collectively "Your Supervisor"). You will
also resign as an officer of the Company (but not as a director) and
as an officer and/or director any of its subsidiaries or affiliates on
the Effective Date. In connection with resigning your offices, you
agree to execute and return to the Company with this Agreement two
signed, undated original resignation letters on Company letterhead in
the forms provided in Appendices A through _to this Agreement.
Appendices A through _are hereby incorporated into and made part of
this Agreement by reference. In addition, you agree to take all such
further steps as the Company may reasonably deem necessary or
appropriate in order to accomplish the official formalities of your
resignation of the officer and/or director positions that you hold
with the Company's subsidiaries or affiliates, including but not
limited to executing board resolutions.
As Special Advisor to the CEO, you will have any or all of the
following duties and responsibilities as determined by Your Supervisor
in his/her discretion:
1. advising the CEO regarding the Company's financial affairs;
2. providing assistance with the Company's investor relations program;
3. assisting with the evaluation and integration of business
acquisitions; and
4. assisting Your Supervisor in such other matters that are consistent
with your background and experience as Your Supervisor may assign you.
The times and places where this work will be performed will be at your
choosing unless otherwise requested by Your Supervisor. Your
Supervisor will assign matters to you from time to time and you will
provide Your Supervisor with written or oral reports as reasonably,
requested by Your Supervisor (or if not requested by Your Supervisor,
then periodically, but not less frequently than annually) detailing
your progress toward accomplishing the tasks and directives given to
you by Your Supervisor. You will also provide additional reports and
materials, upon reasonable request by Your Supervisor. Your Supervisor
will evaluate your performance.
Your Supervisor will control and direct the manner (including the
order) in which you perform the services under this Agreement,
including the details and means by which you provide your services.
You will be an employee of the Company for all purposes during the
term of this Agreement and will not be an independent contractor.
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The position of Special Advisor to the CEO, is a part time special
assignment position in which you will be required to work a minimum of
ten (10) hours per month, however, you also agree that, to the extent
that Your Supervisor requests, you will work up to twenty (20) hours
per month. You will not be required to work more than twenty (20)
hours per month , however, in the event that you do work more than
twenty (20) hours per month, then you will receive no additional
compensation or benefits for such additional work. If, in any month,
Your Supervisor does not specifically assign you a sufficient amount
of work to meet your minimum hour requirement, you will satisfy your
minimum requirement by independently researching and evaluating
developments and trends in your areas of responsibility, as set forth
above, and reporting your findings to Your Supervisor. Your time spent
on business travel at the Company's request (but not commuting to and
from your residence to the Company's New York City headquarters) shall
count toward your ten hour minimum monthly work requirement under this
Agreement.
If requested by Your Supervisor, you agree to attend certain meetings
or programs related to your area of expertise, so long as such meeting
or program does not unreasonably interfere with your other activities.
Furthermore, from time to time, your duties may require you to travel
and attend meetings at various locations, and you agree that no
reasonable request by Your Supervisor for travel or attendance at
meetings will be refused. Your Supervisor will work with you in
scheduling any such business trips or meetings so that they do not
unreasonably interfere with your other activities. The Company will
reimburse you for your reasonable travel expenses pursuant to the
reimbursement policy(ies) in place at the Company at the time you
incur such expenses.
You will maintain an accurate and contemporaneous log showing the time
you have spent performing the foregoing services and this log shall be
deemed conclusive evidence of the time spent. Your Supervisor, at any
time, may request a copy of your log and you agree to provide such a
copy within a reasonable period of time after the request is made.
We have agreed that your part time special assignment will continue
until December 31, 2004, subject to earlier termination by you or the
Company as set forth in Section 3 of this Agreement.
During the Term, except as set forth herein, you may not be employed
by any other person or company, other than the Company, without the
Company's prior written approval, which shall not be unreasonably
withheld. You may, however engage in the following activities without
the Company's prior approval, provided that the three conditions
listed below are met. The permissible activities are: teaching,
sitting on boards of directors or advisory committees of other
companies and providing services to other companies either as a
consultant or an employee. These listed activities are permissible
provided that each (1) is performed outside the fields of publishing,
licensing and entertainment, (2) does not violate the provisions of
Section 5.2 herein, and (3) does not interfere with your duties under
this Agreement. You also agree that, during the term of this Agreement
and for one year after the termination of your employment, you will
not induce any employee of the Company to leave the employ of the
Company or otherwise solicit for employment or affiliation, including
as an independent contractor, any officer, director, or employee of
the Company or its subsidiaries.
2. COMPENSATION AND BENEFITS.
Following is a brief description of the compensation and benefits you
will receive under this Agreement during your part time special
assignment. The terms and conditions of all of your benefits are
subject to the terms and conditions of each of the applicable plans,
policies or arrangements, as they may be amended or terminated by the
Company from time to time, except that the amount of your compensation
as set forth in Section 2.1 and your special bonus as set forth in
Section 2.4 may not be modified, except as provided in Section of this
Agreement.
2.1 Compensation. Your compensation will be at the rate of $800,000
per annum ("Salary") for the period from the Effective Date
through the Scheduled Expiration Date, payable biweekly in
arrears, subject to applicable income tax and employment tax
withholding requirements. The Company also will reimburse you for
any reasonable business expenses you incur in performing your
duties, subject to the Company's standard employee expense
reimbursement policies.
2.2 Bonus for 2002 Calendar Year. You will be entitled to receive a
cash bonus of $500,000 with respect to 2002 (the "2002 Bonus"),
which shall be paid when annual bonuses are paid generally to the
Company's other senior executive officers but in no event later
than March 30, 2003.
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2.3 Administrative Support. The Company will provide you with an
office and secretarial assistance for any work that you perform
while at the Company's New York City headquarters. You also will
be provided any office equipment and supplies you may need to
perform your duties under this Agreement. The Company will not
reimburse you or pay for any office space you may rent or any
office equipment you may purchase in connection with performing
your services under this Agreement without the Company's prior
written approval.
2.4 Retirement and Savings Plan. Subject to the terms of the
Company's 401(k) Plan, you will be eligible to participate in
such Plan until the expiration of the Term (the "Termination
Date").
2.5 Stock Options:
2.5.1 New Grants. As an employee in a part time special
assignment position, you will not be eligible to
receive additional stock option grants after the
Effective Date.
2.5.2 Vesting During Special Assignment. To the extent
that you continue in your part time special
assignment, you will be eligible to continue to
vest in all unvested options that have previously
been granted to you by the Company on the dates
and in the manner provided in your stock option
grant agreements and applicable stock option
plans. No unvested stock options will vest
following the Termination Date except as otherwise
set forth in this Agreement.
2.5.3 Cooperation To Restructure. As we have discussed,
it is our intention that your ability to continue
to vest in and exercise options while in your part
time special assignment position will not result
in any additional compensation charges to the
Company in accordance with U.S. generally accepted
accounting principles. Accordingly, if at any time
the Company determines that it is reasonably
likely that the Company will incur a compensation
charge as a result of your vesting or exercising
options in your part time special assignment
position, then you agree that you will use your
reasonable best efforts to cooperate with the
Company to restructure this Agreement and your
position as the Company reasonably determines is
necessary for you to continue to be able to vest
and exercise your options without creating a
compensation charge to the Company in accordance
with U.S. generally accepted accounting principles
and without causing you to lose any of the
benefits of this Agreement. It is expressly
understood that your "reasonable best efforts to
cooperate with the Company" shall not require that
you take or forbear from taking any action that
would result in any loss of value of the options.
2.5.4 No Amendment to Stock Option Grant Agreements or
Stock Option Plans. Nothing in this Agreement
shall be deemed to alter, amend, or otherwise
modify the terms of your stock option grant
agreements or the terms of the applicable stock
option plans.
2.6 Medical and Dental Insurance. Your medical and dental insurance
coverage will terminate on the Termination Date.
2.7 Life Insurance, Accidental Death and Dismemberment Insurance and
Long Term Disability. Unless permitted under the terms of the
applicable Plans, your Life Insurance, Accidental Death and
Dismemberment Insurance and Long Term Disability coverage will
terminate on the Effective Date.
2.8 Other Benefits. As an employee in a part time special assignment
position, after the Effective Date you will not be eligible to
participate in any of the Company's other benefit plans and
programs, not specifically listed in this letter, including but
not limited to any bonus program, personal illness,
vacation/optional holiday pay; family illness/personal time;
bereavement leave; or holidays. By signing this Agreement, you
agree that, notwithstanding any rights you may otherwise have
under these programs, you hereby waive your claim to any benefits
under these programs.
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3.0 EARLY TERMINATION OF SPECIAL ASSIGNMENT.
If you accept this position, it will become your new assignment and you
will have no right to return to your current position. We have agreed that
you will continue in your part time special assignment position until the
Scheduled Expiration Date, at which time your employment with the Company
will terminate; provided however, that the Term may end sooner in the event
of the following:
3.1 Death. If you shall die during the Term, the Term shall terminate
immediately.
3.2 Disability. If during the Term you shall become physically or
mentally disabled, whether totally or partially, such that you
are unable to perform the principal services hereunder for (i) a
period of six consecutive months or (ii) for shorter periods
aggregating six months during any twelve month period, the
Company may at any time after the last day of the six consecutive
months of disability or the day on which the shorter periods of
disability shall have equaled an aggregate of six months, by
written notice to you (but before you have recovered from such
disability), terminate the Term.
3.3 Cause. The Term may be terminated by the Company upon notice to
you upon the occurrence of any event constituting "Cause" as
defined herein. As used herein, the term "Cause" means: your
willful and intentional failure or refusal to perform or observe
any of your material duties, responsibilities or obligations set
forth in this Agreement; provided, however, that the Company
shall not be deemed to have Cause pursuant to this clause (i)
unless the Company gives you written notice that the specified
conduct has occurred and making specific reference to this
Section 3.3, you are given an opportunity to appear before the
Board of Directors to discuss the conduct alleged to constitute
Cause and you fail to cure the conduct within thirty (30) days
after receipt of such notice; (ii) breach by you of any of your
obligations under Section 5 hereof; (iii) any willful and
intentional acts by you involving fraud, theft, misappropriation
of funds, embezzlement or material dishonesty affecting the
Company or willful misconduct by you which has, or could
reasonably be expected to have, a material adverse effect on the
Company; or (iv) your conviction of, or plea of guilty or nolo
contendre to, an offense which is a felony in the jurisdiction
involved.
3.4 Permitted Termination by You.
3.4.1 The Term may be terminated by you upon notice to
the Company of any event constituting "Good
Reason" as defined herein. As used herein, the
term "Good Reason" means the occurrence of any of
the following, without your prior written consent:
(i) assignment of duties materially inconsistent
with duties as described in Section 1 hereof; (ii)
any material breach of this Agreement by the
Company which is continuing;(iii) if the Company's
headquarters are moved outside the New York City
metropolitan area and you are required to perform
your duties at the new headquarters; or (iv) the
occurrence of a Third Party Change in Control (as
defined in Section 4.5(d)) provided, however, that
you shall not be deemed to have Good Reason
pursuant to clauses (i) and (ii) above unless you
give the Company written notice that the specified
conduct or event has occurred and making specific
reference to this Section 3.4.1 and the Company
fails to cure such conduct or event within thirty
(30) days of receipt of such notice.
3.4.2 The Term may be terminated by you at any time by
giving the Company a notice of termination
specifying a termination date no less than sixty
(60) days after the date the notice is given.
4. SEVERANCE.
4.1 If the Term is terminated pursuant to Section 3.1, 3.2 or 3.3
hereof, or by you other than pursuant to Section 3.4.1, you shall
be entitled to receive your Salary and any additional benefits
provided hereunder at the rates provided in Section 2 hereof to
the date on which such termination shall take effect and you or
your estate shall be entitled to the 2002 Bonus, if not then
paid.
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4.2 If the Term is terminated by you pursuant to Section 3.4.1, the
Company shall continue thereafter to provide you (i) payments of
your Salary in the manner and amounts specified in Section 3.1
until December 31, 2004 (the "Good Reason Severance Period"),
(ii) any unpaid portion of the 2002 bonus and (iii) fringe
benefits in the manner and amounts specified in Section 2.6 until
the earlier of (x) the period ending on the date you begin work
as an employee or consultant for any other entity or (y) the end
of the Good Reason Severance Period. In addition, all unvested
equity arrangements provided to you prior to the Effective Date
or under any employee benefit plan of the Company shall be
accelerated upon the occurrence of the Third Party Change in
Control and shall remain exercisable for ninety days thereafter.
4.3 If the Term expires on the Scheduled Expiration Date as a result
of the Company giving a Notice of Nonrenewal, all payments of
your Salary and all fringe benefits specified in Section 2 shall
cease on the Scheduled Expiration Date but all unvested equity
arrangements provided to you prior to the Effective Date or under
any employee benefit plan of the Company shall continue to vest
until the second anniversary of the Scheduled Expiration Date
unless vesting is accelerated upon the occurrence of the Third
Party Change in Control and shall remain exercisable during such
two year period and for ninety days after the end of such two
year period.
4.4 You understand and agree that if you become employed by a new
employer or self-employed after the Termination Date but prior to
December 31, 2004, up to one-half of the Salary payable to you
after the Termination Date shall be reduced by an amount equal to
the amount earned from such employment (which shall not include
director fees) with respect to that period (and you shall be
required to return to the Company, without interest, any amount
by which such payments pursuant to Section this 4.4 exceed the
Salary to which you are entitled after giving effect to that
reduction) and, if you become eligible to receive medical or
other welfare benefits under another employer provided plan, the
corresponding medical and other welfare benefits provided under
Section 2.6 shall be terminated. You agree to permit verification
of your employment records and Federal income tax returns by an
independent attorney or accountant, selected by the Company but
reasonably acceptable to you, who agrees to preserve the
confidentiality of the information disclosed by you except to the
extent required to permit the Company to verify the amount
received by you from other active employment.
4.5 For purposes of this Agreement, a Third Party Change in Control
shall be deemed to have occurred if (i) any "person" or "group"
(as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act")), other than an Excluded Person or Excluded Group (as
defined below) (hereinafter, a "Third Party"), is or becomes the
"beneficial owner" (as defined in Rule 13d-3 promulgated under
the Exchange Act), directly or indirectly, of securities of the
Company representing fifty percent (50%) or more of the combined
voting power of the Company's then outstanding securities
entitled to vote in the election of directors of the Company,
(ii) the Company is a party to any merger, consolidation or
similar transaction as a result of which either (x) the Company's
common stock ceases to be listed on a national securities
exchange or on NASDAQ or (y) the shareholders of the Company
immediately prior to such transaction beneficially own securities
of the surviving entity representing less than fifty percent
(50%) of the combined voting power of the surviving entity's
outstanding securities entitled to vote in the election of
directors of the surviving entity, or (iii) all or substantially
all of the assets of the Company are acquired by a Third Party.
"Excluded Group" means a "group" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) that includes one
or more Excluded Persons; provided that the voting power of the
voting stock of the Company "beneficially owned" (as such term is
used in Rule 13d-3 promulgated under the Exchange Act) by such
Excluded Persons (without attribution to such Excluded Persons of
the ownership by other members of the "group") represents a
majority of the voting power of the voting stock "beneficially
owned" (as such term is used in Rule 13d-3 promulgated under the
Exchange Act) by such group.
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4.5.1 "Excluded Person" means (i) Xxxxx Xxxxxxxxxx and
Xxx Xxxx or any of their affiliates, (ii) any
spouse or any one or more lineal descendants
Messers Xxxxxxxxxx and Arad or any of their
affiliates, and (iii) any trust established solely
for the benefit of, and any charitable trust or
foundation established by, any person or entity
included in the foregoing clauses (i) and (ii);
provided that each such persons and entity
included in clauses (i) and (ii) shall only be
deemed to be an Excluded Person to the extent that
the Company's securities was received by such
person or entity directly or indirectly from Xx.
Xxxxxxxxxx or Mr. Arad, respectively.
4.6 If any payment or benefit (within the meaning of Section
280G(b)(2) of the Internal Revenue Code of 1986, as amended (the
"Code")), to you or for your benefit paid or payable or
distributed or distributable pursuant to the terms of this
Agreement or otherwise in connection with, or arising out of,
your employment with the Company or a change in ownership or
effective control of the Company or of a substantial portion of
its assets (a "Parachute Payment" or "Parachute Payments"), would
be subject to the excise tax imposed by Section 4999 of the Code
or any interest or penalties are incurred by you with respect to
such excise tax (such excise tax, together with any such interest
and penalties, are hereinafter collectively referred to as the
"Excise Tax"), then you will be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after
payment by you of all taxes (including any interest or penalties,
other than interest and penalties imposed by reason of the you
failure to file timely a tax return or pay taxes shown to be due
on you return), including any Excise Tax imposed upon the
Gross-Up Payment, you retain an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Parachute Payments.
4.7 An initial determination as to whether a Gross-Up Payment is
required pursuant to this Agreement and the amount of such
Gross-Up Payment shall be made at the Company's expense by the
Company's regular outside auditors (the "Accounting Firm"). The
Accounting Firm shall provide its determination (the
"Determination"), together with detailed supporting calculations
and documentation to the Company and you within ten days of the
Termination Date if applicable, or promptly upon request by the
Company or by you (provided you reasonably believe that any of
the Parachute Payments may be subject to the Excise Tax) and if
the Accounting Firm determines that no Excise Tax is payable by
you with respect to a Parachute Payment or Parachute Payments, it
shall furnish you with an opinion reasonably acceptable to you
that no Excise Tax will be imposed with respect to any such
Parachute Payment or Parachute Payments. Within ten days of the
delivery of the Determination to you, you shall have the right to
dispute the Determination (the "Dispute"). The Gross-Up Payment,
if any, as determined pursuant to this Section 4.7 shall be paid
by the Company to you within ten days of the receipt of the
Accounting Firm's determination notwithstanding the existence of
any Dispute. If there is no Dispute, the Determination shall be
binding, final and conclusive upon the Company and you subject to
the application of Section 4.8 below. The Company and you shall
resolve any Dispute in accordance with the terms of this
Agreement.
4.8 As a result of the uncertainty in the application of Sections
4999 and 280G of the Code, the parties acknowledge that it is
possible that a Gross-Up Payment (or a portion thereof) will be
paid which should not have been paid (an "Excess Payment") or a
Gross-Up Payment (or a portion thereof) which should have been
paid will not have been paid (an Underpayment"). An Underpayment
shall be deemed to have occurred (i) upon notice (formal or
informal) to you from any governmental taxing authority that your
tax liability (whether in respect of your current taxable year or
in respect of any prior taxable year) may be increased by reason
of the imposition of the Excise Tax on a Parachute Payment or
Parachute Payments with respect to which the Company has failed
to make a sufficient Gross-Up Payment, (ii) upon a determination
by a court, (iii) by reason of determination by the Company
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(which shall include the position taken by the Company, together
with its consolidated group, on its federal income tax return) or
(iv) upon the resolution of the Dispute to your satisfaction. If
an Underpayment occurs, you shall promptly notify the Company and
the Company shall promptly, but in any event, at least five days
prior to the date on which the applicable government taxing
authority has requested payment, pay to you an additional
Gross-Up Payment equal to the amount of the Underpayment plus any
interest and penalties (other than interest and penalties imposed
by reason of your failure to file timely a tax return or pay
taxes shown to be due on your return) imposed on the
Underpayment. An Excess Payment shall be deemed to have occurred
upon a "Final Determination" (as hereinafter defined) that the
Excise Tax shall not be imposed upon a Parachute Payment or
Parachute Payments (or portion thereof) with respect to which you
had previously received a Gross-Up Payment. A "Final
Determination" shall be deemed to have occurred when you have
received from the applicable government taxing authority a refund
of taxes or other reduction in the your tax liability by reason
of the Excise Payment and upon either (x) the date a
determination is made by, or an agreement is entered into with,
the applicable governmental taxing authority which finally and
conclusively binds you and such taxing authority, or in the event
that a claim is brought before a court of competent jurisdiction,
the date upon which a final determination has been made by such
court and either all appeals have been taken and finally resolved
or the time for all appeals has expired or (y) the statute of
limitations with respect to your applicable tax return has
expired. If an Excess Payment is determined to have been made,
the amount of the Excess Payment shall be treated as a loan by
the Company to you and you shall pay to the Company on demand
(but not less than 10 days after the determination of such Excess
Payment and written notice has been delivered to you) the amount
of the Excess Payment plus interest at an annual rate equal to
the Applicable Federal Rate provided for in Section 1274(d) of
the Code from the date the Gross- Up Payment (to which the Excess
Payment relates) was paid to you until the date of repayment to
the Company.
4.9 Notwithstanding anything contained in this Agreement to the
contrary, in the event that, according to the Determination, an
Excise Tax will be imposed on any Parachute Payment or Parachute
Payments, the Company shall pay to the applicable government
taxing authorities as Excise Tax withholding, the amount of the
Excise Tax that the Company has actually withheld from the
Parachute Payment or Parachute Payments or the Gross Up Payment.
5. PROTECTION OF CONFIDENTIAL INFORMATION; NON-COMPETITION.
5.1 In view of the fact that your work for the Company has brought
you and will continue to bring you into close contact with many
confidential affairs of the Company not readily available to the
public, as well as plans for future developments by the Company,
you agree:
5.1.1 To keep and retain in the strictest confidence all
confidential matters of the Company, including,
without limitation, "know how", trade secrets,
customer lists, pricing policies, operational
methods, technical processes, formulae, inventions
and research projects, and other business affairs
of the Company ("Confidential Information"),
learned by you heretofore or hereafter, and not to
use or disclose them to anyone outside of the
Company, either during or after your employment
with the Company, except in the course of
performing your duties hereunder or with the
Company's express written consent; provided,
however, that the restrictions of this Section
5.1.1 shall not apply to that part of the
Confidential Information that you demonstrate is
or becomes generally available to the public other
than as a result of a disclosure by you or is
available, or becomes available, to you on a
non-confidential basis, but only if the source of
such information is not prohibited from
transmitting the information to you by a
contractual, legal, fiduciary, or other
obligation; and
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5.1.2 To deliver promptly to the Company on termination
of your employment by the Company, or at any time
the Company may so request, all memoranda, notes,
records, reports, manuals, drawings, blueprints
and other documents (and all copies thereof)
relating to the Company's business and all
property associated therewith, which you may then
possess or have under your control.
5.2 Prior to December 31, 2004, you shall not, directly or
indirectly, enter the employ of, or render any services to, any
person, firm or corporation engaged in any business competitive
with the business of the Company or of any of its subsidiaries or
affiliates; you shall not engage in such business on your own
account; and you shall not become interested in any such
business, directly or indirectly, as an individual, partner,
shareholder, director, officer, principal, agent, employee,
trustee, consultant, or in any other relationship or capacity;
provided, however, that nothing contained in this Section 5.2
shall be deemed to prohibit you from acquiring, solely as an
investment, up to five percent (5%) of the outstanding shares of
capital stock of any public corporation or taking a position with
a business the main business of which is the sale of retail
products to customers.
5.3 If you commit a breach, or threaten to commit a breach, of any of
the provisions of Sections 5.1 or 5.2 hereof, the Company shall
have the following rights and remedies:
5.3.1 The right and remedy to have the provisions of
this Agreement specifically enforced by any court
having equity jurisdiction, it being acknowledged
and agreed that any such breach or threatened
breach will cause irreparable injury to the
Company and that money damages will not provide an
adequate remedy to the Company; and
5.3.2 The right and remedy to require you to account for
and pay over to the Company all compensation,
profits, monies, accruals, increments or other
benefits (collectively "Benefits") derived or
received by you as the result of any transactions
constituting a breach of any of the provisions of
Section 5.2 hereof, and you hereby agree to
account for and pay over such Benefits to the
Company. Each of the rights and remedies
enumerated above shall be independent of the
other, and shall be severally enforceable, and all
of such rights and remedies shall be in addition
to, and not in lieu of, any other rights and
remedies available to the Company under law or in
equity.
5.4 If any of the covenants contained in Sections 5.1 or 5.2 hereof,
or any part thereof, hereafter are construed to be invalid or
unenforceable, the same shall not affect the remainder of the
covenant or covenants, which shall be given full effect, without
regard to the invalid portions.
5.5 If any of the covenants contained in Sections 5.1 or 5.2 hereof,
or any part thereof, are held to be unenforceable because of the
duration of such provision or the area covered thereby, the
parties hereto agree that the court making such determination
shall have the power to reduce the duration and/or area of such
provision and, in its reduced form, said provision shall then be
enforceable.
5.6 The parties hereto intend to and hereby confer jurisdiction to
enforce the covenants contained in Sections 5.1 and 5.2 hereof
upon the courts of any state within the geographical scope of
such covenants. In the event that the courts of any one or more
of such states shall hold such covenants wholly unenforceable by
reason of the breadth of such covenants or otherwise, it is the
intention of the parties hereto that such determination not bar
or in any way affect the Company's right to the relief provided
above in the courts of any other states within the geographical
scope of such covenants as to breaches of such covenants in such
other respective jurisdictions, the above covenants as they
relate to each state being for this purpose severable into
diverse and independent covenants.
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5.7 In the event that any action, suit or other proceeding in law or
in equity is brought to enforce the covenants contained in
Sections 5.1 and 5.2 hereof or to obtain money damages for the
breach thereof, and such action results in the award of a
judgment for money damages or in the granting of any injunction
in favor of the Company, all expenses (including reasonable
attorneys' fees) of the Company in such action, suit or other
proceeding shall (on demand of the Company) be paid by you. In
the event the Company fails to obtain a judgment for money
damages or an injunction in favor of the Company, all expenses
(including reasonable attorneys' fees) of yours in such action,
suit or other proceeding shall (on your demand) be paid by the
Company.
6. INVENTIONS AND PATENTS.
You agree that all processes, technologies and inventions, including new
contributions, improvements, ideas and discoveries, whether patentable or not,
conceived, developed, invented or made by you during your employment by the
Company, whether heretofore or hereafter, or for one year thereafter
(collectively, "Inventions") shall belong to the Company, provided that such
Inventions grew out of your work with the Company or any of its subsidiaries or
affiliates, are related to the business (commercial or experimental) of the
Company or any of its subsidiaries or affiliates or are conceived or made on the
Company's time or with the use of the Company's facilities or materials. You
shall promptly disclose such Inventions to the Company and shall, subject to
reimbursement by the Company for all reasonable expenses incurred by you in
connection therewith, (a) assign to the Company, without additional
compensation, all patent and other rights to such Inventions for the United
States and foreign countries; (b) sign all papers necessary to carry out the
foregoing; and (c) give testimony in support of your inventorship.
7. INTELLECTUAL PROPERTY.
The Company shall be the sole owner of all the products and proceeds of your
services hereunder and under the Employment Agreement, including, but not
limited to, all materials, ideas, concepts, formats, suggestions, developments,
arrangements, packages, programs and other intellectual properties that you may
acquire, obtain, develop or create in connection with and during your employment
whether heretofore or hereafter, free and clear of any claims by you (or anyone
claiming under you) of any kind or character whatsoever (other than your right
to receive payments hereunder). You shall, at the request of the Company,
execute such assignments, certificates or other instruments as the Company may
from time to time deem necessary or desirable to evidence, establish, maintain,
perfect, protect, enforce or defend its right, title or interest in or to any
such properties.
8. INDEMNIFICATION.
To the fullest extent permitted by applicable law, you shall be indemnified and
held harmless for any action or failure to act in your capacity as an officer or
employee of the Company or any of its affiliates or subsidiaries, whether prior
to or after the date hereof. In furtherance of the foregoing and not by way of
limitation, if you are a party or are threatened to be made a party to any suit
because you were or are an officer or employee of the Company or such affiliate
or subsidiary, you shall be indemnified against expenses, including reasonable
attorney's fees, judgments, fines and amounts paid in settlement if you acted in
good faith and in a manner reasonably believed to be in or not opposed to the
best interest of the Company, and with respect to any criminal action or
proceeding, you had no reasonable cause to believe your conduct was unlawful.
Indemnification under this Section 8 shall be in addition to any other
indemnification by the Company of its officers and directors. Expenses incurred
by you in defending an action, suit or proceeding for which you claim the right
to be indemnified pursuant to this Section 8 shall be paid by the Company in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of you to repay such amount in the event that
it shall ultimately be determined that you are not entitled to indemnification
by the Company. Such undertaking shall be accepted without reference to your
financial ability to make repayment. The provisions of this Section 8 shall
apply as well to your actions and omissions as a trustee of any employee benefit
plan of the Company, its affiliates or subsidiaries.
9. ARBITRATION; LEGAL FEES.
Except with respect to injunctive relief under Section 5 of this Agreement, any
dispute or controversy arising out of or relating to this Agreement shall be
resolved exclusively by arbitration in New York City in accordance with the
Commercial Arbitration Rules of the American Arbitration Association then in
effect. Judgment on the award may be entered in any court having jurisdiction
thereof. The Company shall reimburse your reasonable costs and expenses incurred
in connection with any arbitration proceeding pursuant to this Section 9 if you
are the substantially prevailing party in that proceeding.
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10. NOTICES.
All notices, requests, consents and other communications required or permitted
to be given hereunder shall be in writing and shall be deemed to have been duly
given if delivered personally, sent by overnight courier or mailed first class,
postage prepaid, by registered or certified mail (notices mailed shall be deemed
to have been given on the date mailed), as follows (or to such other address as
either party shall designate by notice in writing to the other in accordance
herewith):
If to the Company, to:
Marvel Enterprises, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
If to the Executive, to:
F. Xxxxx Xxxxx
00 Xxx Xxxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxx 00000
11. GENERAL.
11.1 This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of New York applicable to
agreements made and to be performed entirely in New York, without
regard to the conflict of law principles of such state.
11.2 The section headings contained herein are for reference purposes
only and shall not in any way affect the meaning or
interpretation of this Agreement.
11.3 This Agreement and your stock option agreements sets forth the
entire agreement and understanding of the parties relating to the
subject matter hereof and supersedes all prior agreements,
arrangements and understandings, written or oral, relating to the
subject matter hereof, including the Employment Agreement between
you and the Company dated July 19, 1999 and you expressly
acknowledge the termination of such Employment Agreement. No
representation, promise or inducement has been made by either
party that is not embodied in this Agreement, and neither party
shall be bound by or liable for any alleged representation,
promise or inducement not so set forth. This Agreement expressly
supersedes all agreements and understandings between the parties
regarding the subject matter hereof and any such agreement is
terminated as of the date first above written.
11.4 This Agreement, and your rights and obligations hereunder, may
not be assigned by you. The Company may assign its rights,
together with its obligations, hereunder (i) to any affiliate or
(ii) to third parties in connection with any sale, transfer or
other disposition of all or substantially all of its business or
assets; in any event the obligations of the Company hereunder
shall be binding on its successors or assigns, whether by merger,
consolidation or acquisition of all or substantially all of its
business or assets.
11.5 This Agreement may be amended, modified, superseded, canceled,
renewed or extended and the terms or covenants hereof may be
waived, only by a written instrument executed by both of the
parties hereto, or in the case of a waiver, by the party waiving
compliance. The failure of either party at any time or times to
require performance of any provision hereof shall in no manner
affect the right at a later time to enforce the same. No waiver
by either party of the breach of any term or covenant contained
in this Agreement, whether by conduct or otherwise, in any one or
more instances, shall be deemed to be, or construed as, a further
or continuing waiver of any such breach, or a waiver of the
breach of any other term or covenant contained in this Agreement.
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11.6 Implementation. The Company and you both agree, without the
receipt of further consideration, to sign and deliver any
documents and do anything else that is necessary in the future to
make the provisions of this Agreement effective.
Sincerely yours,
/s/---------------------------
Xxxxx X. Xxxxxx
Executive Vice President
Acknowledged and Agreed:
/s/----------------------- Dated: December 16, 2002
F. Xxxxx Xxxxx
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