EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of the first
day of April, 1997, by and between CinemaStar Luxury Theaters, Inc., a
California corporation (hereinafter the "Company"), and Xxx Xxxxxx, an
individual (hereinafter "Employee").
W I T N E S S E T H
WHEREAS, the Company desires to retain the services of the Employee, and
the Employee is willing to be an employee of the Company, on the terms and
subject to the conditions hereinafter set forth.
NOW, THEREFORE, for and in consideration of the mutual promises herein
contained, the parties hereto hereby agree as follows:
1. ENGAGEMENT; NATURE OF DUTIES. Company hereby engages Employee, for
the period hereinafter set forth, to serve as and hold the office of Vice
President, Secretary and General Counsel, and to perform the duties of such
offices as directed by the Board of Directors of the Company. Employee agrees
to serve in such capacities and to do and perform the services, acts, or
things necessary to carry out the duties of such offices, and such other
duties (including service as an officer and/or director of any subsidiary of
the Company, not inconsistent with such office and Employee's position as an
executive officer of the Company, as Company and Employee may mutually agree.
Employee shall report only to the President of the Company.
2. TERM. The term of employment pursuant to this Agreement shall be
for a period of five (5) years, commencing on the date of this Agreement (the
"Commencement Date"), unless sooner terminated in accordance with the
provisions hereof (the "Term").
3. PERFORMANCE OF DUTIES. Employee shall devote his best efforts and
his entire business time and attention to his duties hereunder. The Employee
shall not accept or undertake any other employment with any person, firm or
entity other than the Company (regardless of whether such other person, firm,
or entity is in competition with the Company or any of its subsidiaries)
without first having obtained the approval of the Board of Directors of the
Company, which shall be given in the Company's sole and absolute discretion.
Employee shall perform his duties hereunder primarily in the San Diego,
California area, it being understood that Employee's
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duties hereunder may require travel. Employee shall not be required to
relocate without his consent.
4. COMPENSATION.
(a) BASE SALARY. Company shall pay to Employee a base salary in
the amount of Ninety Thousand Dollars ($90,000) per year (the "Base Salary"),
payable in periodic installments in accordance with Company's prevailing
policy for compensating personnel, but not less often than semi-monthly. The
Company may, but shall not be obligated to, increase Employee's salary at any
time, in the Company's sole and absolute discretion.
(b) DISCRETIONARY BONUS. In addition to the Base Salary, and any
and all other compensation, profit-sharing participation, benefits or other
amounts due to or receivable by Employee pursuant to this Agreement, Employee
may receive, in the sole and absolute discretion of the Company, an annual
bonus in such amount and on such terms as are determined by the Company.
5. EXPENSE REIMBURSEMENT. The Company shall pay, or if Employee shall
have paid, shall reimburse to Employee, any and all reasonable expenses
incurred by him or for his account in the performance of his duties
hereunder, subject only to Employee providing appropriate documentation for
such expenses; provided, however, that Employee shall not be entitled to
reimbursement for any expense in excess of $500 without the prior approval of
the President or Senior Executive Vice President of the Company.
6. MEDICAL AND LIFE INSURANCE; PENSION BENEFITS. Employee shall have
the right to participate in any and all group, life, disability income,
health or accident insurance programs that are in effect during the period of
Employee's employment hereunder, subject only to any eligibility restrictions
of such programs. Coverage under any group health insurance shall also cover
Employee's spouse. Employee shall also have the right to participate in any
and all employee retirement benefits plan or profit-sharing plan which
Company maintains for its personnel, and in effect at any time during the
period of Employee's employment hereunder, subject only to any eligibility
restrictions of such plans.
In addition to the foregoing, the Company shall purchase and
maintain (or reimburse Employee for any premiums paid under) life insurance
on the life of Employee providing for a death benefit to Employee or his
beneficiaries of at least $100,000; provided, however, that the Company shall
only be required to maintain or reimburse Employee for premiums under such
life insurance policy to the extent that Employee is insurable and such
policy can be purchased at a standard rate.
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7. VACATION. During each year of the Term, Employee shall be entitled
to 3 weeks without deduction in pay. Such vacation shall be taken at such
time or times during the applicable year as may be mutually determined by
Employee and Company. Any additional vacation period shall be determined by
Company consistent with the general customs and practices of the Company
applicable to its personnel.
8. TERMINATION.
8.1 TERMINATION EVENTS. Employee's employment and the
obligations of the Company, including, without limitation, the obligation of
the Company to pay Employee any unearned Base Salary or Bonus, shall
terminate upon the earliest to occur of:
8.1.1 March 31, 2003;
8.1.2 Employee's death or disability;
8.1.3 The termination of Employee's employment "for
Cause" as described in Section 8.2;
8.1.4 The termination of Employee's employment by
Employee, including retirement; and
8.2 TERMINATION FOR CAUSE. The following acts, events or
omissions shall constitute "cause" to terminate Employee's employment during
the term of this Agreement:
8.2.1 The gross neglect or willful dereliction or the
breach of any of Employee's duties, covenants, agreements or obligations
hereunder. Unless the acts on the part of Employee warrant immediate
termination, Employee will be given written notice of the gross neglect,
willful dereliction or breach of duty and be given a 30-day period to correct
the situation.
8.2.2 The engagement by Employee in material dishonest or
fraudulent conduct or behavior or disclosure of confidential information
other than in connection with the performance of Employee's duties hereunder.
8.2.3 Employee's conviction of a felony involving
dishonesty, fraud or other similar acts.
8.3 PRORATIONS. Any compensation payable to Employee hereunder
shall be prorated through the Termination Date.
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8.4 DISABILITY. Disability means physical or mental illness
resulting in Employee's absence on a full-time basis from Employee's duties
with the Company for ninety (90) consecutive calendar days.
9. INDEMNIFICATION. The Company shall indemnify, defend and hold
Employee harmless from and against any and all claims, demands, suits,
obligations, liabilities, actions, losses, costs, expenses, fines or
penalties (collectively, "Claims") which may now or hereafter be pending,
threatened or commenced against or incurred by Employee relating to or in any
way resulting from Employee's performance of his duties, hereunder, or any
action or failure to act of Employee in connection with such duties, except
for those Claims which arise from Employee's dishonesty, bad faith or gross
negligence or deliberate dereliction of duty, to the fullest extent permitted
by the Company's by-laws and California law. Employee's rights under this
Section 9 shall be in addition to, and not in lieu of, any and all other
rights of Employee under applicable law or any agreement with the Company
regarding indemnification.
10. CONFIDENTIAL INFORMATION.
(a) As used in this Agreement, "Confidential Information" means
any and all information disclosed to Employee or which Employee gains
knowledge of as a consequence of or through Employee's employment by Company
(including information conceived, originated, discovered or developed by
Employee) about Company's products, processes, and services, including
information relating to research, development, inventions, purchasing,
accounting, marketing, merchandising, selling, trade secrets, customer or
supplier lists, which information the Company maintains as confidential.
(b) Except as required in Employee's duties to Company and then
only with Company's prior written consent, Employee will not, directly or
indirectly, use for Employee's own benefit or the benefit of others, or
disseminate, disclose, lecture upon or publish articles concerning, any
Confidential Information either during or at any time after the term of this
Agreement.
(c) All documents, papers, notes, notebooks, memoranda, computer
files, and other written electronic records of any kind by Company, shall
remain the property of Company at all times. Upon the termination of
Employee's employment with Company, all
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documents, papers, notes, notebooks, memoranda, computer files and other
written or electronic records in Employee's possession, whether prepared by
Employee or others will be left with Company.
11. NOTICES. Any and all notices which are required or permitted to be
given by any party to any other party hereunder shall be given in writing,
sent by registered or certified mail, electronic communications (including
telegram or facsimile) followed by a confirmation letter sent by registered
or certified mail, postage prepaid, return receipt requested, or delivered by
hand or messenger service with the charges therefor prepaid, addressed to
such party as follows:
(a) Notices to the Employee: Xxx Xxxxxx
0000 Xxxxx Xxxx
Xxxxxxxxx, XX 00000
(b) Notice to the Company: CinemaStar Luxury Theaters, Inc.
000 Xxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
or to such other address as the parties shall from time to time give notice
of in accordance with this Section. Notices sent in accordance with this
Section shall be deemed effective on the date of dispatch, and an affidavit
of mailing or dispatch, executed under penalty of perjury, shall be deemed
presumptive evidence of the date of dispatch.
12. ENTIRE AGREEMENT AND MODIFICATIONS. This Agreement constitutes the
entire understanding between the parties pertaining to the subject matter
hereof and supersedes all prior agreements, understandings, negotiations and
discussions, whether oral or written. There are no warranties,
representations or other agreements between the parties, in connection with
the subject matter hereof, except as specifically set forth herein. No
supplement, modification, waiver or termination of this Agreement shall be
binding unless made in writing and executed by the party thereto to be bound.
13. WAIVERS. No term, condition or provision of this Agreement may be
waived except by an express written instrument to such effect signed by the
party to whom the benefit of such term, condition or provision runs. No such
waiver of any term, condition or provision of this Agreement shall be deemed
a waiver of any other term, condition or provision, irrespective of
similarity, or shall constitute a continuing waiver of the same term,
condition or provision, unless otherwise expressly provided. No failure or
delay on the part of any party in exercising any right, power or
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privilege under any term, condition or provision of this Agreement shall
operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise of any other right, power or privilege.
14. SEVERABILITY. In the event any one or more of the terms,
conditions or provisions contained in this Agreement should be found in a
final award or judgment rendered by any court or arbitrator or panel of
arbitrators of competent jurisdiction to be invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
terms, conditions and provisions contained herein shall not in any way be
affected or impaired thereby, and this Agreement shall be interpreted and
construed as if such term, condition or provision, to the extent the same
shall have been held invalid, illegal, or unenforceable, had never been
contained herein, provided that such interpretation and construction is
consistent with the intent of the parties as expressed in this Agreement.
15. HEADINGS. The headings of the Articles and Sections contained in
this Agreement are included herein for reference purposes only, solely for
the convenience of the parties hereto, and shall not in any way be deemed to
affect the meaning, interpretation or applicability of this Agreement or any
term, condition or provision hereof.
16. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of California, notwithstanding the
fact that one or more counterparts hereof may be executed outside of the
state, or one or more of the obligations of the parties hereunder are to be
performed outside of the state.
17. ATTORNEYS' FEES. In the event that any party to this Agreement
shall commence any suit, action, arbitration or other proceeding to interpret
this Agreement, or determine or enforce any right or obligation created
hereby, including but not limited to any action for rescission of this
Agreement or for a determination that this Agreement is void or ineffective
AB INITIO, the prevailing party in such action shall recover such party's
costs and expenses incurred in connection therewith, including attorney's
fees and costs of appeal, if any. Any court, arbitrator or panel of
arbitrators shall, in entering any judgment or making any award in any such
suit, action, arbitration or other proceeding, in addition to any and all
other relief awarded to such prevailing party, include in such judgment or
award such party's costs and expenses as provided in this Section 17.
18. EXECUTION AND COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which when so
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executed and delivered shall be deemed an original, and such counterparts
together shall constitute only one instrument. Any or all of such
counterparts may be executed within or outside the State of California. Any
one of such counterparts shall be sufficient for the purpose of proving the
existence and terms of this Agreement, and no party shall be required to
produce an original or all of such counterparts in making such proof.
19. COVENANT OF FURTHER ASSURANCES. All parties to this Agreement
shall, upon request, perform any and all acts and execute and deliver any and
all certificates, instruments and other documents that may be necessary or
appropriate to carry out any of the terms, conditions and provisions hereof
or to carry out the intent of this Agreement.
20. REMEDIES CUMULATIVE. Each and all of the several rights and
remedies provided for in this Agreement shall be construed as being
cumulative and no one of them shall be deemed to be exclusive of the others
or of any right or remedy allowed by law or equity, and pursuit of any one
remedy, or a waiver of any other remedy.
21. BINDING EFFECT. Subject to the restrictions in Section 25 hereof
respecting assignments, this Agreement shall inure to the benefit of and be
binding upon all of the parties hereto and their respective executors,
administrators, successors and permitted assigns.
22. COMPLIANCE WITH LAWS. Nothing contained in this Agreement shall be
construed to require the commission of any act contrary to law, and whenever
there is a conflict between any term, condition or provision of this
Agreement and any present or future statute, law, ordinance or regulation
contrary to which the parties have no legal right to contract, the latter
shall prevail, but in such event the term, condition or provision of this
Agreement affected shall be curtailed and limited only to the extent
necessary to bring it within the requirement of the law, provided that such
construction is consistent with the intent of the parties as expressed in
this Agreement.
23. GENDER. As used in this Agreement, the masculine, feminine or
neuter gender, and the singular or plural number, shall be deemed to include
the others whenever the context so indicates.
24. NO THIRD PARTY BENEFIT. Nothing contained in this Agreement shall
be deemed to confer any right or benefit on any person who is not a party to
this Agreement.
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25. ASSIGNMENT. Neither party may assign this Agreement, or any rights
hereunder, without the prior express consent of the other party.
26. ARBITRATION. Any claim arising out of or relating to this
Agreement, or the breach thereof, or Employee's employment by Company, or the
termination of Employee's employment by Company, shall be settled by binding
arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Association then in effect, and judgment upon the award
entered by the arbitrator(s) may be entered in any court having jurisdiction
thereof.
IN WITNESS WHEREOF, the parties have duly executed this Agreement
as of the day and year first above written.
"Company"
CinemaStar Luxury Theaters, Inc.,
a California corporation
By: /s/ XXXX XXXXXXX, JR.
----------------------
Xxxx Xxxxxxx, Jr.
President & Chief
Executive Officer
"Employee"
/s/ XXX XXXXXX
-------------------------
Xxx Xxxxxx
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