EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT made as of this 5th day of June, 1996 (the
"Agreement") with an effective date of July 1, 1996, between GUITAR CENTER
MANAGEMENT COMPANY, INC., a California corporation (the "Company"), and Xxxxx
X. Xxxxxxx (the "Executive").
The execution and delivery of this Agreement by the Company and the
Executive is a condition to the closing of the Stock Purchase Agreement (the
"Purchase Agreement") of even date herewith by and among the Company, Chase
Venture Capital Associates, L.P., Xxxxx Fargo Small Business Investment Company,
Inc., Weston Presidio Capital II, L.P. (collectively, the "Investors"), and the
security holder of the Company.
In consideration of the mutual covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. EMPLOYMENT. The Company shall employ the Executive, and the Executive
accepts employment with the Company, upon the terms and conditions set forth in
this Agreement for the period beginning on the date hereof and ending as
provided in paragraph 4 hereof (the "Employment Period").
2. POSITION AND DUTIES.
(a) During the Employment Period, the Executive shall serve
initially as the Vice President-Corporate Development and General Counsel of
the Company and shall have the normal duties, responsibilities and authority
of the Vice President-Corporate Development and General Counsel, subject to
the power of the board of directors of the Company (the "Board") and the
powers delegated to the Executive's superiors (if any) by the Board.
(b) The Executive shall report to the Board or its designee, and the
Executive shall devote his best efforts and substantially all of his business
time, attention and energies (except for permitted vacation periods and
reasonable periods of illness or other incapacity) to the business and affairs
of the Company and its Subsidiaries (as defined below). The Executive shall
perform his duties and responsibilities to the best of his abilities in a
diligent, trustworthy, and businesslike manner. During the Employment Period,
the Executive shall not engage in any business activity which, in the reasonable
judgment of the Board, materially conflicts with the duties of the Executive
hereunder, whether or not such activity is pursued for gain, profit or other
pecuniary advantage; PROVIDED, HOWEVER, that nothing herein is intended to
prohibit Executive from managing his own investment portfolio; PROVIDED FURTHER,
HOWEVER, that the Company acknowledges that the Executive may devote such time
that
the Executive deems appropriate to his real estate and law enterprise,
including, without limitation, his "of counsel" relationship with Buchalter,
Nemer, Fields & Younger, so long as Executive shall at all times adequately
fulfill his obligations pursuant to this Section 2(b).
(c) For purposes of this Agreement, (i) "SUBSIDIARIES" shall mean any
corporation of which the securities having a majority of the voting power in
electing directors are, at the time of determination, owned by the Company,
directly or through one or more Subsidiaries; and (ii) "PERSON" shall be
construed broadly and shall include, without limitation, an individual, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization, a limited liability company and a governmental entity or any
department or agency thereof.
3. BASE SALARY AND BENEFITS.
(a) During the Employment Period, the Executive's base salary shall
be $225,000 per annum or such higher rate as the Board (excluding the Executive
if he should be a member of the Board at the time of such determination) may
designate from time to time (the "Base Salary"), which salary shall be payable
in such installments as is the policy of the Company with respect to its senior
executive employees and shall be subject to Federal, state and local withholding
and other payroll taxes. In addition, during the Employment Period, the
Executive shall be entitled to participate in all employee benefit programs for
which all executives of the Company are generally eligible and the Executive
shall be eligible to participate in all insurance plans available generally to
all executives of the Company.
(b) In addition to the Base Salary, for each fiscal year ending
during the Employment Period, Executive shall also be eligible to receive an
annual bonus at the discretion of the Board.
(c) The Company shall reimburse the Executive for all reasonable
expenses incurred by him in the course of performing his duties under this
Agreement which are consistent with the Company's policies in effect from time
to time with respect to travel, entertainment and other business expenses,
subject to the Company's requirements with respect to reporting and documenting
such expenses. The Company shall reimburse the Executive for all bar dues and
real estate broker license fees. The Company shall reimburse the executive for
all library and reference materials and the cost of any continuing education and
seminars approved by the President of the Company.
(d) During the Employment Period, the Executive shall be entitled to
3 weeks paid vacation during each 12-month period worked, commencing on the date
hereof.
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(e) The Company shall issue Executive options to acquire shares of
Common Stock in the amounts and on the dates set forth on A hereto.
(f) Notwithstanding any benefit provided to the Executive as provided
in Section 3(a) hereinabove, the Company shall pay or provide, at a minimum, at
the Company's expense, an automobile allowance of $800.00 per month and a car
phone including monthly access fees.
4. TERM; SEVERANCE.
(a) Unless renewed by the mutual agreement of the Company and the
Executive, the Employment Period shall end on December 31, 1999; PROVIDED,
HOWEVER, that (i) the Employment Period shall terminate prior to such date upon
the Executive's resignation pursuant to the provisions of Section 4(f) or 4(g)
hereof, or the death or Disability (as hereinafter defined) of Executive; and
(ii) the Employment Period may be terminated by the Company at any time prior to
such date for Cause (as defined below) or without Cause. For purposes of this
Agreement the term "DISABILITY" means any long-term disability or incapacity
which (i) renders the Executive unable to substantially perform all of his
duties hereunder for 180 days during any 18-month period or (ii) would
reasonably be expected to render the Executive unable to substantially perform
all of his duties for 180 days during any 18-month period, in each case as
determined by the Board (excluding the Executive if he should be a member of the
Board at the time of such determination) in its good faith judgment after
seeking and reviewing advice from a qualified physician.
(b) If the Employment Period is terminated by the Company without
Cause or by the Executive with Reasonable Justification, the Executive shall be
entitled to receive as severance the Base Salary, an annual cash bonus equal to
the last annual bonus (excluding any portion thereof that the President of the
Company considered extraordinary and non-recurring) he received prior to
termination (such bonus to be pro-rated for any partial year), and continuation
of his medical benefits (or, if such continuation is not permitted by the
Company's insurers beyond the Employment Period, an annual cash payment equal to
the average premium the company pays to obtain health insurance for an
employee), for the period beginning on the date of such termination and ending
on December 31, 1999, unless the Executive has breached the provisions of this
Agreement, in which case the provisions of paragraph 11(a)(iii) shall apply.
For purposes of this Section 4(b), benefits will not include future
participation in any discretionary bonus or equity incentive pool, other than
continuation of annual cash bonuses as contemplated in the previous sentence.
Such severance payments will be made periodically in the same amounts and at the
same intervals as
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the Base Salary, annual bonus and benefits (as applicable) were paid immediately
prior to termination of employment. Executive shall have no duty to mitigate
any damages which Executive may suffer as a result of such termination nor shall
the severance benefits payable be reduced by any sums actually earned by
Executive as a result of any other employment obtained by Executive during the
original Employment Period. In addition, if the Employment Period is terminated
by the Company without Cause, all stock options held by the Executive may
immediately vest pursuant to the terms of the agreements by which such options
were issued.
(c) If the Employment Period is terminated for any reason (including
pursuant to paragraph 4(h)) other than by the Company without Cause or by the
Executive with Reasonable Justification, the Executive shall be entitled to
receive only the Base Salary and then only to the extent such amount has accrued
through the date of termination.
(d) Except as otherwise expressly required by law (E.G., COBRA) or as
specifically provided herein, all of the Executive's rights to salary,
severance, benefits, bonuses and other amounts hereunder (if any) accruing after
the termination of the Employment Period shall cease upon such termination. In
the event that the Employment Period is terminated by the Company without Cause
or by the Executive with Reasonable Justification, the Executive's sole remedy
shall be to receive the severance payments and benefits described in paragraph
4(b) hereof.
(e) For purposes of this Agreement, "Cause" means (i) the repeated
failure by the Executive to perform such lawful duties consistent with
Executive's position as are reasonably requested by the Board as documented in
writing to the Executive, (ii) the Executive's repeated material neglect of his
duties on a general basis (other than as a result of illness or disability),
notwithstanding written notice of objection from the Board and the expiration of
a thirty (30) day cure period, (iii) the commission by the Executive of any act
of fraud, theft or criminal dishonesty with respect to the Company or any of its
Subsidiaries or affiliates, or the conviction of the Executive of any felony,
(iv) the commission of any act involving moral turpitude which (A) brings the
Company or any of its affiliates into public disrepute or disgrace, or (B)
causes material injury to the customer relations, operations or the business
prospects of the Company or any of its affiliates, and (v) material breach by
the Executive of this Agreement, including, without limitation, any breach by
the Executive of the provisions of paragraph 5, 6 or 7 hereof, not cured within
thirty (30) days after written notice to Executive from the Board; PROVIDED,
HOWEVER, that in the event of an intentional breach of the provisions of
paragraph 5, 6 or 7 hereof, the Executive shall not have the opportunity to
cure.
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(f) The Executive may within ninety (90) days, after giving written
notice to the Company and the Company's failure to cure, voluntarily terminate
employment with the Company upon any event giving rise to Reasonable
Justification for such voluntary termination.
(g) For purposes of this Agreement, "Reasonable Justification" shall
mean any voluntary termination by the Executive of his employment with the
Company within ninety (90) days after the occurrence of any of the following
events:
(i) the Executive is directed to perform an act that the
Executive reasonably believes to be in contravention of law, or
which the Executive reasonably believes would subject the Company
and himself to material liability, despite his express written
objection addressed to the Board with respect to such action;
(ii) there has been any change (on other than a temporary basis)
without the Executive's consent in the Executive's title or any
material reduction in the nature or scope of his responsibilities, or
the Executive is assigned duties that are materially inconsistent
with his position (other than on a temporary basis);
(iii) there is any material reduction in the Executive's
compensation or benefits (other than reductions in benefits that
generally effect all employees entitled to such benefits ratably);
(iv) the Executive is required by the Company, after written
objection by the Executive, to relocate his principal place of
employment outside a radius of fifty miles from his place of
employment immediately prior to such relocation; or
(v) there is a material failure, after notice and an
opportunity to cure, by the Company to perform any of its obligations
to the Executive under this Agreement.
(h) If at any time during the Employment Period, there is a Sale of
the Company (as defined in that certain Stockholders Agreement, dated as of June
5, 1996, by and among the Company and certain of its stockholders), Executive
may resign within ninety (90) days of the occurrence of such event by notifying
the Company in writing.
5. NONDISCLOSURE AND NONUSE OF CONFIDENTIAL INFORMATION.
(a) The Executive will not disclose to a third party or use for his
personal benefit or for the benefit of a third
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party, at any time, either during the Employment Period or thereafter, any
Confidential Information (as defined below) of which the Executive is or becomes
aware, whether or not such information is developed by him, except to the extent
that such disclosure or use is directly related to and required by the
Executive's performance in good faith of duties assigned to the Executive by the
Company. The Executive will take all reasonable and appropriate steps to
safeguard Confidential Information and to protect it against disclosure, misuse,
espionage, loss and theft. The Executive shall deliver to the Company at the
termination of the Employment Period or at any time the Company may request all
memoranda, notes, plans, records, reports, computer tapes and software and other
documents and data (and copies thereof) relating to the Confidential
Information, Work Product (as defined below) or the business of the Company or
any of its Subsidiaries which the Executive may then possess or have under his
control.
(b) As used in this Agreement, the term "Confidential Information"
means information that is not generally known to the public and that is used,
developed or obtained by the Company in connection with its business, including
but not limited to (i) information, observations and data obtained by the
Executive while employed by the Company (including those obtained prior to the
date of this Agreement) concerning the business or affairs of the Company, (ii)
products or services, (iii) fees, costs and pricing structures, (iv) designs,
(v) analyses, (vi) drawings, photographs and reports, (vii) computer software,
including operating systems, applications and program listings, (viii) flow
charts, manuals and documentation, (ix) data bases, (x) accounting and business
methods, (xi) inventions, devices, new developments, methods and processes,
whether patentable or unpatentable and whether or not reduced to practice, (xii)
customers and clients and customer or client lists, (xiii) other copyrightable
works, (xiv) all production methods, processes, technology and trade secrets,
and (xv) all similar and related information in whatever form. Confidential
Information will not include any information that has been published in a form
generally available to the public prior to the date the Executive proposes to
disclose or use such information. Confidential Information will not be deemed
to have been published merely because individual portions of the information
have been separately published, but only if all material features comprising
such information have been published in combination.
6. INVENTIONS AND PATENTS.
(a) The Executive agrees that all inventions, innovations,
improvements, technical information, systems, software developments, methods,
designs, analyses, drawings, reports, service marks, trademarks, tradenames,
logos and all similar or related information (whether patentable or
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unpatentable) which relates to the Company's or any of its Subsidiaries' actual
or anticipated business, research and development or existing or future products
or services and which are conceived, developed or made by the Executive (whether
or not during usual business hours and whether or not alone or in conjunction
with any other person) while employed by the Company (including those conceived,
developed or made prior to the date of this Agreement) together with all patent
applications, letters patent, trademark, tradename and service xxxx applications
or registrations, copyrights and reissues thereof that may be granted for or
upon any of the foregoing (collectively referred to herein as, the "Work
Product") belong to the Company or such Subsidiary. The Executive will promptly
disclose such Work Product as may be susceptible of such manner of communication
to the Board and perform all actions reasonably requested by the Board (whether
during or after the Employment Period) to establish and confirm such ownership
(including, without limitation, the execution and delivery of assignments,
consents, powers of attorney and other instruments) and to provide reasonable
assistance to the Company or any of its Subsidiaries in connection with the
prosecution of any applications for patents, trademarks, trade names, service
marks or reissues thereof or in the prosecution or defense of interferences
relating to any Work Product.
(b) CALIFORNIA EMPLOYEE PATENT ACT NOTIFICATION. In accordance
with Section 2872 of the California Employee Patent Act, West's Cal. Lab.
Code Section 2870 ET. SEQ, Executive is hereby advised that subparagraph
6(a) does not apply to any invention, new development or method (and all
copies and tangible embodiments thereof) made solely by Executive for which
no equipment, facility, material, Confidential Information or intellectual
property of the Company or any of its Subsidiaries was used and which was
developed entirely on Employee's own time; PROVIDED, HOWEVER, that
subparagraph 6(a) shall apply if the invention, new development or method (i)
relates to the Company's or any of its Subsidiaries' actual or demonstrably
anticipated businesses or research and development, or (ii) results from any
work performed by Executive for the Company or any of its Subsidiaries.
7. NON-COMPETE AND NON-SOLICITATION.
(a) The Executive acknowledges and agrees with the Company that
during the course of the Executive's involvement and/or employment with, or
ownership of options and/or Common Stock in, the Company, such Executive has had
and will continue to have the opportunity to develop relationships with existing
employees, vendors, suppliers, customers and other business associates of the
Company which relationships constitute goodwill of the Company, and the Company
would be irreparably damaged if the Executive were to take actions that would
damage
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or misappropriate such goodwill. Accordingly, the Executive agrees as follows:
(i) The Executive acknowledges that the Company currently
conducts its business throughout the United States, including without
limitation the areas listed on Exhibit B attached hereto (the "Territory").
Accordingly, during the period commencing on the date hereof and ending on
the later of (x) the termination of the Employment Period or (y) if the
Executive was terminated without Cause or resigns with Reasonable
Justification, December 31, 1999 (such period is referred to herein as the
"Non-Compete Period"), the Executive shall not, directly or indirectly,
enter into, engage in, assist, give or lend funds to or otherwise finance,
be employed by or consult with, or have a financial or other interest in,
any business which engages in selling at retail musical instruments,
pro-audio equipment or related accessories within the Territory (the "Line
of Business"), whether for or by himself or as a representative for any
other Person.
(ii) Notwithstanding the foregoing, the aggregate ownership by
the Executive of no more than two percent (on a fully-diluted basis) of the
outstanding equity securities of any entity, which securities are traded on
a national or foreign securities exchange, quoted on the Nasdaq Stock
Market or other automated quotation system, and which entity competes with
the Company (or any part thereof) within the Territory, shall not (by
itself) be deemed to be giving or lending funds to, otherwise financing or
having a financial interest in a competitor. In the event that any entity
in which the Executive has any financial or other interest directly or
indirectly enters into the Line of Business during the Non-Compete Period,
the Executive shall divest all of his interest (other than any amount
permitted to be held pursuant to the first sentence of this Section 7
(a)(ii)) in such entity within thirty (30) days after learning that such
entity has entered the Line of Business.
(iii) The Executive covenants and agrees that during the
Non-Compete Period, the Executive will not, directly or indirectly, either
for himself or for any other person or entity, solicit any employee of the
Company (other than such Executive's personal assistant or secretary) or
any Subsidiary to terminate his or her employment with the Company or any
Subsidiary or employ any such individual during his or her employment with
the Company or any Subsidiary and for a period of six months after such
individual terminates his or her employment with the Company or any
Subsidiary.
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(b) The Executive understands that the foregoing restrictions may
limit his ability to earn a livelihood in a business similar to the business of
the Company, but he nevertheless believes that he has received and will receive
sufficient consideration and other benefits as an employee or holder of Common
Stock of the Company and as otherwise provided hereunder to clearly justify such
restrictions which, in any event (given his education, skills and ability), the
Executive does not believe would prevent him from otherwise earning a living.
(c) The provisions of this Section 7 shall terminate in the event the
Company fails to make any payments required by Section 4(b) and such failure
remains uncured for a period equal to at least thirty (30) days after written
notice of such event from Executive.
8. INDEMNIFICATION. The Company and the Executive are entering into an
Indemnification Agreement on the date hereof in substantially the form attached
hereto of Annex A.
9. INSURANCE. The Company may, for its own benefit, maintain "keyman"
life and disability insurance policies covering the Executive, provided the same
does not prevent Executive from obtaining reasonable amounts of insurance for
his family or estate planing needs. The Executive will cooperate with the
Company and provide such information or other assistance as the Company may
reasonably request in connection with the Company obtaining and maintaining such
policies.
10. EXECUTIVE REPRESENTATION. The Executive hereby represents and
warrants to the Company that (a) the execution, delivery and performance of this
Agreement by the Executive does not and will not conflict with, breach, violate
or cause a default under any agreement, contract or instrument to which the
Executive is a party or any judgment, order or decree to which the Executive is
subject, (b) the Executive is not a party to or bound by any employment
agreement, consulting agreement, non-compete agreement, confidentiality
agreement or similar agreement with any other person or entity and (c) upon the
execution and delivery of this Agreement by the Company and the Executive, this
Agreement will be a valid and binding obligation of the Executive, enforceable
in accordance with its terms.
11. NOTICES. All notices, requests, demands, claims, and other
communications hereunder shall be in writing. Any notice, request, demand,
claim or other communication hereunder shall be delivered personally to the
recipient, delivered by United States Post office mail (postage prepaid and
return receipt requested), telecopied to the intended recipient at the number
set forth therefor below (with hard copy to follow), or sent to the recipient by
reputable express courier service
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(charges prepaid) and addressed to the intended recipient as set forth below:
If to the Company, to:
Guitar Center Management Company, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
With copies to:
Buchalter, Nemer, Fields & Younger
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxx Xxxxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000; and
X'Xxxxxxxx Graev & Karabell, LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
Sidley & Austin
000 X. Xxxxx Xx.
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxxxxx, Esq.
Telecopier: (000) 000-0000
If to the Executive, to:
Xxxxx Xxxxxxx
000 Xxxxxxx Xxxxxx Xxxx
Xxxxxxxx Xxxxxxx, XX 00000
Telephone: (000) 000-0000
or such other address as the recipient party to whom notice is to be given may
have furnished to the other party in writing in accordance herewith. Any such
communication shall deemed to have been delivered and received (a) when
delivered, if personally delivered, sent by telecopier or sent by overnight
courier, and (b) on the fifth business day following the date posted, if sent by
mail.
12. GENERAL PROVISIONS.
(a) SEVERABILITY/ENFORCEMENT.
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(i) It is the desire and intent of the parties hereto that the
provisions of this Agreement be enforced to the fullest extent permissible
under the laws and public policies applied in each jurisdiction in which
enforcement is sought. Accordingly, if any particular provision of this
Agreement shall be adjudicated by a court of competent jurisdiction to be
invalid, prohibited or unenforceable for any reason, such provision, as to
such jurisdiction, shall be ineffective, without invalidating the
remaining provisions of this Agreement or affecting the validity or
enforceability of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
Notwithstanding the foregoing, if such provision could be more narrowly
drawn so as not to be invalid, prohibited or unenforceable in such
jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn,
without invalidating the remaining provisions of this Agreement or
affecting the validity or enforceability of such provision in any other
jurisdiction. Without limiting the generality of the preceding sentence,
if at the time of enforcement of paragraph 5, 6 or 7 of this Agreement, a
court holds that the restrictions stated therein are unreasonable under
circumstances then existing, the parties hereto agree that the maximum
period, scope or geographical area reasonable under such circumstances
shall be substituted for the stated period, scope or area and that the
failure of all or any of such provisions to be enforceable shall not
impair or affect the obligations of the Company to pay compensation or
severance obligations under this Agreement.
(ii) Because the Executive's services are unique and because the
Executive has access to Confidential Information and Work Product, the
parties hereto agree that money damages would be an inadequate remedy for
any breach of this Agreement by the Executive. Therefore, in the event of
a breach or threatened breach of this Agreement, the Company or its
successors or assigns may, in addition to other rights and remedies
existing in their favor, apply to any court of competent jurisdiction for
specific performance and/or injunctive or other relief in order to
enforce, or prevent any violations of, the provisions hereof (without
posting a bond or other security).
(iii) In addition to the foregoing, and not in any way in
limitation thereof, or in limitation of any right or remedy otherwise
available to the Company, if the Executive materially violates any
provision of paragraph 5, 6 or 7 (and such violation, if unintentional on
the part of the Executive, continues for a period of thirty (30) days
following receipt of written notice from the Company), any severance
payments then or thereafter due from the Company to the Executive may be
terminated forthwith and upon such
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election by the Company, the Company's obligation to pay and the
Executive's right to receive such severance payments shall terminate and be
of no further force or effect. The Executive's obligations under
paragraphs 5, 6 or 7 of this Agreement shall not be limited or affected by,
and such provisions shall remain in full force and effect notwithstanding
the termination of any severance payments by the Company in accordance with
this paragraph 11(a)(iii). The exercise of the right to terminate such
payments shall not be deemed to be an election of remedies by the Company
and shall not in any manner modify, limit or preclude the Company from
exercising any other rights or seeking any other remedies available to it
at law or in equity.
(b) COMPLETE AGREEMENT. This Agreement, those documents expressly
referred to herein and all other documents of even date herewith embody the
complete agreement and understanding among the parties and supersede and preempt
any prior understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any way.
(c) SUCCESSORS AND ASSIGNS. Except as otherwise provided herein,
this Agreement shall bind and inure to the benefit of and be enforceable by the
Executive and the Company and their respective successors, assigns, heirs,
representatives and estate; PROVIDED, HOWEVER, that the rights and obligations
of the Executive under this Agreement shall not be assigned without the prior
written consent of the Company.
(d) GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF CALIFORNIA, WITHOUT GIVING
EFFECT TO ANY CHOICE OF LAW OR CONFLICTING PROVISION OR RULE (WHETHER OF THE
STATE OF CALIFORNIA, OR ANY OTHER JURISDICTION), THAT WOULD CAUSE THE LAWS OF
ANY JURISDICTION OTHER THAN THE STATE OF CALIFORNIA TO BE APPLIED. IN
FURTHERANCE OF THE FOREGOING, THE INTERNAL LAW OF THE STATE OF CALIFORNIA WILL
CONTROL THE INTERPRETATION AND CONSTRUCTION OF THIS AGREEMENT, EVEN IF UNDER
SUCH JURISDICTION'S CHOICE OF LAW OR CONFLICT OF LAW ANALYSIS, THE SUBSTANTIVE
LAW OF SOME OTHER JURISDICTION WOULD ORDINARILY APPLY.
(e) JURISDICTION, ETC.
(i) Each of the parties hereto hereby irrevocably
and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any California State court or Federal court of
the United States of America sitting in the State of California, and any
appellate court from any thereof, in any action or proceeding arising out
of or relating to this Agreement or for recognition or enforcement of any
judgment, and each of the parties hereto hereby
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irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such
California State court or, to the extent permitted by law, in such Federal
court. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Agreement
in the courts of any jurisdiction.
(ii) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Agreement in
any California State or Federal court. Each of the parties hereto
irrevocably waives, to the fullest extent permitted by law, the defense of
an inconvenient forum to the maintenance of such action or proceeding in
any such court.
(iii) The Company and the Executive further agree that the
mailing by certified or registered mail, return receipt requested, of any
process required by any such court shall constitute valid and lawful
service of process against them, without the necessity for service by any
other means provided by law.
(f) AMENDMENT AND WAIVER. The provisions of this Agreement may be
amended and waived only with the prior written consent of the Company, the
Executive and the Investors, and no course of conduct or failure or delay in
enforcing the provisions of this Agreement shall affect the validity, binding
effect or enforceability of this Agreement or any provision hereof.
(g) WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO
SO, TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING ARISING HEREUNDER.
(h) HEADINGS. The section headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(i) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the date first written above.
GUITAR CENTER MANAGEMENT
COMPANY, INC.
By: /s/ Xxxxx Xxxxxxxxx
---------------------------
Name: Xxxxx Xxxxxxxxx
Title: Executive Vice President
/s/ Xxxxx X. Xxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxx
EXHIBIT A
OPTIONS TO BE GRANTED
TO EXECUTIVE
Defined terms used herein, but not defined herein, shall have the meaning
ascribed to them in the attached Employment Agreement or the Company's 1996
Performance Stock Option Plan (the "Plan").
1. Within 15 days after the execution of the attached Agreement, the
Company shall grant Executive an option to acquire 8,669 shares of Common
Stock pursuant to the Plan.
2. If any Reserved Shares become Shares Available for Award pursuant
to Section 7(c) of the Plan on 12/31/96 and Executive is still employed by
the Company at such time, then the Company shall grant Executive an option
to receive 10% of such Shares Available for Award.
3. If any Reserved Shares become Shares Available for Award pursuant
to Section 7(c) of the Plan on 12/31/97 and Executive is still employed by
the Company at such time, then the Company shall grant Executive an option
to receive 10% of such Shares Available for Award.
4. If any Reserved Shares become Shares Available for Award pursuant
to Section 7(c) of the Plan on 12/31/98 and Executive is still employed by
the Company at such time, then the Company shall grant Executive an option
to receive 10% of such Shares Available for Award.
5. If any Reserved Shares become Shares Available for Award pursuant
to Section 7(e) of the Plan and Executive is still employed by the Company
at such time, the Company shall grant to Executive an option to acquire
that number of such Shares Available for Award equal to (x) the lesser of
8,669 or 10% of such Shares Available for Award MINUS (y) the number of
Shares Available for Award that were subject to the options issued pursuant
to paragraphs 2, 3 and 4 above. Any share numbers referred to in this
paragraph 5 shall be subject to adjustment as contemplated by Section 11 of
the Plan.
6. All options issued pursuant to this Agreement shall be
exercisable for $1.00 per share of Common Stock.
7. All options issued pursuant to this Agreement prior to the
Company's initial public offering shall be NQ0s.
1
EXHIBIT B
TERRITORY
CALIFORNIA:
-----------
Los Angeles County metropolitan areas
Orange County metropolitan areas
San Diego County metropolitan areas
San Francisco/Alameda/Contra Costa/Marin/San Mateo
County metropolitan areas
San Bernardino/Riverside County metropolitan area
TEXAS:
------
Dallas/Ft. Worth metropolitan area
Houston metropolitan area
FLORIDA:
--------
Miami metropolitan area
Ft. Lauderdale/Hollywood metropolitan area
ILLINOIS:
---------
Chicago metropolitan area
MASSACHUSETTS:
--------------
Boston metropolitan area
MICHIGAN:
---------
Detroit metropolitan area
MINNESOTA:
----------
Minneapolis/St. Xxxx metropolitan area
ANNEX A
Form of Indemnification Agreement.
INDEMNIFICATION AGREEMENT
This Indemnification Agreement ("Agreement") is made as of June 5,
1996, by and between Guitar Center Management Company, Inc., a California
corporation (the "Corporation"), and the undersigned director or officer of the
Company ("Indemnitee"), with reference to the following facts:
A. Indemnitee is currently serving as a director or officer of the
Corporation.
B. The Corporation and Indemnitee recognize the substantial increase
in corporate litigation in general, subjecting officers and directors to
expensive litigation risks at the same time as the availability and coverage of
liability insurance has been severely limited.
C. Indemnitee does not regard the current protection available to be
adequate under the present circumstances to protect him or her against the risks
associated with his or her service to the Corporation and the Corporation
recognizes that Indemnitee and other officers and directors of the Corporation
may not be willing to continue to serve as officers or directors without
additional protection.
D. The Corporation desires to attract and retain the services of
highly qualified individuals, including Indemnitee, to serve as officers and
directors of the Corporation and thus desires to indemnify its officers and
directors to provide them with the maximum protection permitted by law.
E. The execution and delivery of this Agreement is a condition to
the closing of those certain transactions contemplated by that certain Agreement
(the "Purchase Agreement"), dated as of May 1, 1996, by and among the
Corporation, the securityholders of the Corporation named therein and certain
other parties.
THEREFORE, IN CONSIDERATION OF the foregoing premises, the Corporation
and Indemnitee hereby agree as follows:
1. INDEMNIFICATION.
1.1. THIRD PARTY PROCEEDINGS.
The Corporation shall indemnify the Indemnitee if Indemnitee is or was
a party or is threatened to be made a party to any proceeding (other than an
action by or in the right of the Corporation to procure a judgment in its favor)
by reason of the fact that Indemnitee is or was a director, officer or agent of
the Corporation, or any subsidiary of the Corporation, by reason of any action
or inaction on the part of Indemnitee while an
officer, director or agent or by reason of the fact that Indemnitee is or was
serving at the request of the Corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including subject to Section 13, attorneys' fees
and any expenses of establishing a right to indemnification pursuant to this
Agreement or under California law), judgments, fines, settlements (if such
settlement is approved in advance by the corporation, which approval shall not
be unreasonably withheld) and other amounts actually and reasonably incurred by
Indemnitee in connection with such proceeding if Indemnitee acted in good faith
and in a manner Indemnitee reasonably believed to be in or not opposed to the
best interests of the Corporation and, in the case of a criminal proceeding, if
Indemnitee had no reasonable cause to believe Indemnitee's conduct was unlawful.
The termination of any proceeding by judgment, order, settlement, conviction or
upon a plea of nolo contenders or its equivalent shall not, of itself, create a
presumption that Indemnitee did not act in good faith and in a manner which
Indemnitee reasonably believed to be in or not opposed to the best interests of
the corporation, or with respect to any criminal proceedings, would not create a
presumption that Indemnitee had reasonable cause to believe that Indemnitee's
conduct was unlawful.
1.2. PROCEEDINGS BY OR IN THE RIGHT OF THE CORPORATION.
The Corporation shall indemnify Indemnitee if Indemnitee was or is a party
or is threatened to be made a party to any threatened, pending or completed
action by or in the right of the Corporation or any subsidiary of the
Corporation to procure a judgment in its favor by reason of the fact that
Indemnitee is or was a director, officer or agent of the Corporation, or any
subsidiary of the Corporation, by reason of any action or inaction on the part
of Indemnitee while an officer, director or agent or by reason of the fact that
Indemnitee is or was serving at the request of the Corporation as a director,
officer or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including subject to Section 13, attorneys'
fees and any expenses of establishing a right to indemnification pursuant to
this Agreement or under California law) and, to the fullest extent permitted by
law, amounts paid in settlement, in each case to the extent actually and
reasonably incurred by Indemnitee in connection with the defense or settlement
of the proceeding if Indemnitee acted in good faith and in a manner Indemnitee
believed to be in or not opposed to the best interests of the Corporation and
its shareholders, except that no indemnification shall be made with respect to
any claim, issue or matter to which Indemnitee shall have been adjudged to have
been liable to the Corporation in the performance of Indemnitee's duty to the
corporation and its shareholders, unless and only to the extent that the court
in which such proceeding is or was pending shall
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determine upon application that, in view of all the circumstances of the case,
Indemnitee is fairly and reasonably entitled to indemnity for expenses and then
only to the extent that the court shall determine.
1.3. SUCCESSFUL DEFENSE ON MERITS.
To the extent that Indemnitee has been successful on the merits in
defense of any proceeding referred to in Sections 1.1 or 1.2 above, or in
defense of any claim, issue or matter therein, the Corporation shall indemnify
Indemnitee against expenses (including attorneys' fees) actually and reasonably
incurred by Indemnitee in connection therewith. An Indemnitee shall be deemed
to have been successful on the merits, if the Plaintiff in the action does not
prevail in obtaining the relief sought in the suit or action of demanded in the
claim.
1.4. CERTAIN TERMS DEFINED.
For purposes of this Agreement, references to "other enterprises"
shall include employee benefit plans, references to "fines" shall include any
excise taxes assessed on Indemnitee with respect to an employee benefit plan,
and references to "proceeding" shall include any threatened, pending or
completed action or proceeding, whether civil, criminal, administrative or
investigative. References to "corporation" include all constituent corporations
absorbed in a consolidation or merger as well as the resulting or surviving
corporation, so that any person who is or was a director, officer, or agent of
such a constituent corporation or who, being or having been such a director,
officer, or agent of another corporation, partnership, joint venture, trust or
other enterprise shall stand in the same position under the provisions of this
Agreement with respect to the resulting or surviving corporation as such person
would if he or she had served the resulting or surviving corporation in the same
capacity.
2. AGREEMENT TO SERVE.
Indemnitee agrees to serve or continue to serve as a director and/or
officer of the Corporation for so long as he or she is duly elected or appointed
or until such time as he or she voluntarily resigns. The terms of any existing
employment agreement between Indemnitee and the Corporation shall continue in
effect but shall be modified or supplemented by the terms of this Agreement.
Nothing contained in this Agreement is intended to create in Indemnitee any
right to continued employment.
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3. EXPENSES: INDEMNIFICATION PROCEDURE.
3.1. ADVANCEMENT OF EXPENSES.
The Corporation shall advance all expenses incurred by Indemnitee in
connection with the investigation, defense, settlement (excluding amounts
actually paid in settlement of any action, suit or proceeding) or appeal of any
civil or criminal action, suit or proceeding referenced in Sections 1.1 or 1.2
hereof. Indemnitee hereby undertakes to repay such amounts advanced only if,
and to the extent that, it shall be determined ultimately that Indemnitee is not
entitled to be indemnified by the Corporation as authorized hereby. The
advances to be made hereunder shall be paid by the Corporation to Indemnitee
within 20 days following delivery of a written request therefor by Indemnitee to
the Corporation.
3.2. NOTICE OF CLAIM.
Indemnitee shall, as a condition precedent to his or her right to be
indemnified under this Agreement, give the corporation notice in writing as soon
as practicable of any claim made against Indemnitee for which indemnification
will or could be sought under this Agreement; PROVIDED, HOWEVER, that the
failure to give such notice shall not affect the Indemnitee's rights hereunder
except and only to the extent such failure prejudiced the Corporation's ability
to successfully defend the matter subject to such notice. Notice to the
Corporation shall be directed to the President and the Secretary of the
Corporation at the principal business office of the Corporation with copies to
X'Xxxxxxxx Graev & Karabell, LLP, 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxxx X. Xxxxxxxxx, Esq. (or such other address as the
Corporation shall designate in writing to Indemnitee). In addition, Indemnitee
shall give the Corporation such information and cooperation as it may reasonably
require and as shall be within Indemnitee's power.
3.3. ENFORCEMENT RIGHTS.
Any indemnification provided for in Sections 1.1, 1.2 or 1.3 shall be
made no later than 60 days after receipt of the written request of Indemnitee.
If a claim or request under this Agreement, under any statute, or under any
provision of the Corporation's Articles of Incorporation or Bylaws providing for
indemnification is not paid by the Corporation, or on its behalf, within 60 days
after written request for payment thereof has been received by the Corporation,
Indemnitee may, but need not, at any time thereafter bring suit against the
Corporation to recover the unpaid amount of the claim or request, and subject to
Section 13, Indemnitee shall also be entitled to be paid for the expenses
(including attorneys' fees) of bringing such action. It shall be a defense to
any such action (other than an action brought to enforce a claim for expenses
incurred in connection with any
-4-
action, suit or proceeding in advance of its final disposition) that Indemnitee
has not met the standards of conduct which make it permissible under applicable
law for the Corporation to indemnify Indemnitee for the amount claimed, but the
burden of proving such defense shall be on the Corporation, and Indemnitee shall
be entitled to receive interim payments of expenses pursuant to Section 3.1
unless and until such defense may be finally adjudicated by court order or
judgment for which no further right of appeal exists. The parties hereto intend
that if the Corporation contests Indemnitee's right to indemnification, the
question of Indemnitee's right to indemnification shall be a decision for the
court, and no presumption regarding whether the applicable standard has been met
will arise based on any determination or lack of determination of such by the
Corporation (including its Board of Directors (the "Board") or any subgroup
thereof, independent legal counsel or its shareholders).
3.4. ASSUMPTION OF DEFENSE.
In the event the Corporation shall be obligated to pay the expenses of
any proceeding against the Indemnitee, the Corporation, if appropriate, shall be
entitled to assume the defense of such proceeding with counsel approved by
Indemnitee which approval shall not be unreasonably withheld, upon the delivery
to Indemnitee of written notice of its election so to do. After delivery of such
notice, approval of such counsel by Indemnitee and the retention of such counsel
by the Corporation, the Corporation will not be liable to Indemnitee under this
Agreement for any fees of counsel subsequently incurred by Indemnitee with
respect to the same proceeding, unless (i) the employment of counsel by
Indemnitee is authorized by the Corporation, (ii) Indemnitee shall have
reasonably concluded, based upon written advice of counsel, that there may be a
conflict of interest of such counsel retained by the Corporation between the
Corporation and Indemnitee in the conduct of such defense, or (iii) the
Corporation ceases or terminates the employment of such counsel with respect to
the defense of such proceeding, in any of which events then the fees and
expenses of Indemnitee's counsel shall be at the expense of the Corporation. At
all times, Indemnitee shall have the right to employ other counsel in any such
proceeding at Indemnitee's expense, and to participate in the defense of the
proceeding or claim through such counsel.
3.5. NOTICE TO INSURERS.
If, at the time of the receipt of a notice of a claim pursuant to
Section 3.2 hereof, the Corporation has director and officer liability insurance
in effect, the Corporation shall give prompt notice of the commencement of such
proceeding to the insurers in accordance with the procedures set forth in the
respective policies. The Corporation shall thereafter take all
-5-
necessary or desirable action to cause such insurers to pay, on behalf of the
Indemnitee, all amounts payable as a result of such proceeding in accordance
with the terms of such policies.
3.6. SUBROGATION.
In the event of payment under this Agreement, the Corporation shall be
subrogated to the extent of such payment to all of the rights of recovery of the
Indemnitee, who shall do all things that may be necessary to secure such rights,
including the execution of such documents necessary to enable the Corporation
effectively to bring suit to enforce such rights.
4. EXCEPTIONS.
Notwithstanding any other provision herein to the contrary, the
Corporation shall not be obligated pursuant to the terms of this Agreement:
4.1. EXCLUDED ACTS.
To indemnify Indemnitee (i) as to circumstances in which indemnity is
expressly prohibited pursuant to California law, or (ii) for any acts or
omissions or transactions from which a director may not be relieved of liability
pursuant to California law; or (iii) any act or acts of bad faith or willful
misconduct; or
4.2. CLAIMS INITIATED BY INDEMNITEE.
To indemnify or advance expenses to Indemnitee with respect to
proceedings or claims initiated or brought voluntarily by Indemnitee and not by
way of defense, except with respect to proceedings brought to establish or
enforce a right to indemnification under this Agreement or any other statute or
law or as otherwise required under the Corporations Code of California, but such
indemnification or advancement of expenses may be provided by the Corporation in
specific cases if the Board has approved the initiation or bringing of such
suit; or
4.3. LACK OF GOOD FAITH.
To indemnify Indemnitee for any expenses incurred by the Indemnitee
with respect to any proceeding instituted by Indemnitee to enforce or interpret
this Agreement, if a court of competent jurisdiction determines that such
proceeding was not made in good faith or was frivolous; or
4.4. INSURED CLAIMS.
To indemnify Indemnitee for expenses or liabilities of any type
whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes
or penalties, and amounts paid in
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settlement) which have been paid directly to Indemnitee by an insurance carrier
under a policy of officers' and directors' liability insurance maintained by the
Corporation; or
4.5. BREACHES OF AGREEMENTS.
To indemnify Indemnitee for expenses or liabilities (including
indemnification obligations of Indemnitee) of any type whatsoever arising from
his breach of the Purchase Agreement, an employment agreement with the
Corporation (if any) or any other agreement with the Corporation or any of its
subsidiaries; or
4.6. CLAIMS UNDER SECTION 16(B).
To indemnify Indemnitee for expenses and the payment of profits
arising from the purchase and sale by Indemnitee of securities in violation of
Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar
successor statute.
5. PARTIAL INDEMNIFICATION.
If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Corporation for some or a portion of the expenses,
judgments, fines or penalties actually or reasonably incurred by the
Indemnitee in the investigation, defense, appeal or settlement of any civil
or criminal action, suit or proceeding, but not, however, for the total
amount thereof, the Corporation shall nevertheless indemnify Indemnitee for
the portion of such expenses, judgments, fines or penalties to which
Indemnitee is entitled.
6. ADDITIONAL INDEMNIFICATION RIGHTS; NONEXCLUSIVITY.
6.1. SCOPE.
In the event of any change in any applicable law, statute or rule
which narrows the right of a California corporation to indemnify a member of its
Board or an officer, such changes, to the extent not otherwise required by such
law, statute or rule to be applied to this Agreement shall have no effect on
this Agreement or the parties, rights and obligations hereunder. Nothing in
this Agreement is intended to relieve Indemnitee from any obligations he may
have pursuant to the Purchase Agreement, an employment agreement (if any) or any
other agreement with the corporation or its subsidiaries.
6.2. NON-EXCLUSIVITY.
Nothing herein shall be deemed to diminish or otherwise restrict any
rights to which Indemnitee may be entitled under the Corporation's Amended and
Restated Articles of Incorporation, the Corporation's Amended and Restated
Bylaws, any agreement, any
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vote of shareholders or disinterested directors, or, except as expressly
provided herein, under the laws of the State of California.
7. MUTUAL ACKNOWLEDCRMENT.
Both the Corporation and Indemnitee acknowledge that, in certain
instances, Federal law or applicable public policy may prohibit the Corporation
from indemnifying its directors and officers under this Agreement or otherwise.
Indemnitee understands and acknowledges that the Corporation has undertaken or
may be required in the future to undertake with the Securities and Exchange
Commission to submit the question of indemnification to a court in certain
circumstances for a determination of the corporation's right under public policy
to indemnify Indemnitee.
8. OFFICER AND DIRECTOR LIABILITY INSURANCE.
The Corporation shall, from time to time, make the good faith
determination whether or not it is practicable for the Corporation to obtain and
maintain a policy or policies of insurance with reputable insurance companies
providing the officers and directors of the Corporation with coverage for losses
from wrongful acts, or to ensure the Corporation's performance of its
indemnification obligations under this Agreement. Among other considerations,
the Corporation will weigh the costs of obtaining such insurance coverage
against the protection afforded by such coverage. Notwithstanding the
foregoing, the Corporation shall have no obligation to obtain or maintain such
insurance if the Corporation determines in good faith that such insurance is not
reasonably available, if the premium costs for such insurance are
disproportionate to the amount of coverage provided, if the coverage provided by
such insurance is limited by exclusions so as to provide an insufficient
benefit, or if Indemnitee is covered by similar insurance maintained by a
subsidiary or parent of the Corporation.
9. SEVERABILITY.
Nothing in this Agreement is intended to require or shall be construed
as requiring the Corporation to do or fail to do any act in violation of
applicable law. The Corporation's inability, pursuant to court order, to
perform its obligations under this Agreement shall not constitute a breach of
this Agreement. If this Agreement or any portion hereof shall be invalidated on
any ground by any court of competent jurisdiction, then the Corporation shall
nevertheless indemnify Indemnitee to the fullest extent permitted by any
applicable portion of this Agreement that shall not have been invalidated and
the balance of this Agreement not so invalidated shall be enforceable in
accordance with its terms.
-8-
10. EFFECTIVE DATES.
This Agreement shall be effective as of the date set forth on the
first page.
11. COVERAGE.
The provisions of this Agreement shall continue as to Indemnitee for
any action taken or not taken while serving in an indemnified capacity even
though Indemnitee may have ceased to serve in such capacity at the time of any
action, suit or other covered proceeding. This Agreement shall be binding upon
the Corporation and its successors and assigns and shall inure to the benefit of
Indemnitee and Indemnitee's estate, heirs, legal representatives and assigns.
12. NOTICE.
All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed duly given (i) if delivered by
hand and receipted for by the addressee, on the date of such receipt, or (ii) if
mailed by domestic certified or registered mail with postage prepaid, on the
third business day after the date postmarked. Addresses for notice to either
party are as shown on the signature page of this Agreement or as subsequently
modified by written notice.
13. ATTORNEYS' FEES.
In the event that any action is instituted by Indemnitee under this
Agreement to enforce or interpret any of the terms hereof, Indemnitee shall
be entitled to be paid all court costs and expenses, including reasonable
attorneys' fees, incurred by Indemnitee with respect to such action, unless
as a part of such action, the court of competent jurisdiction determines that
the action was not instituted in good faith or was frivolous. In the event
of an action instituted by or in the name of the Corporation under this
Agreement, or to enforce or interpret any of the terms of this Agreement,
Indemnitee shall be entitled to be paid all court costs and expenses,
including attorneys' fees, incurred by Indemnitee in defense of such action
(including with respect to Indemnitee's counterclaims and cross-claims made
in such action), unless as a part of such action the court determines that
Indemnitee's defenses to such action were not made in good faith or were
frivolous.
14. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with
the laws of the State of California, as applied to contracts between California
residents entered into and to be performed entirely within California.
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15. CONSENT TO JURISDICTION.
The Corporation and Indemnitee each hereby irrevocably
consent to the jurisdiction of the courts of the State of California for all
purposes in connection with any action or proceeding which arises out of or
relates to this Agreement and agree that any action instituted under this
Agreement shall be brought only in the state courts in the State of California.
16. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, all of
which taken together shall constitute one instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
GUITAR CENTER MANAGEMENT Address:
COMPANY, INC.
0000 Xxxxxxxx Xxxxx
Xxxxxx Xxxxx, XX 00000
By:_________________________________
Title:______________________________
INDEMNITEE Address:
______________________________
______________________________
____________________________________
(Signature)
____________________________________
