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Exhibit 10.2
EMPLOYMENT AGREEMENT
THIS AGREEMENT (together with all exhibits hereto, the
"Agreement"), made in New York, New York as of the 15th day of May, 1997,
between GT Interactive Software Corp., a Delaware corporation having its
executive offices and principal place of business in New York, New York (the
"Company"), and Xxxxx Xxxxxxxx, the undersigned individual ("Executive").
IN CONSIDERATION, therefore, of the mutual covenants and
agreements hereinafter set forth, the Company and Executive agree as follows:
1. Agreement Term.
The term of this Agreement shall be the three-year
period commencing on May 15, 1997 and ending on May 14, 2000 (the "Agreement
Term").
2. Employment.
(a) Employment by the Company. Executive agrees to be
employed by the Company for the Agreement Term upon the terms and subject to the
conditions set forth in this Agreement. Executive shall serve as an executive of
the Company and shall have such duties as may be prescribed by the Chief
Executive Officer.
(b) Performance of Duties. Throughout the Agreement
Term, Executive shall faithfully and diligently perform Executive's duties in
conformity with the directions of the Company and serve the Company to the best
of Executive's ability. Executive shall devote Executive's entire working time,
attention and energies to the business and affairs of the Company, subject to
vacations and sick leave in accordance with Company policy, provided, that
Executive may devote a reasonable amount of time to civic, community and charity
work, and may serve on the Boards of Directors of the two corporations set forth
on Schedule A, in each case to the extent that such activities do not conflict
with Executive's performance of his duties as required hereunder. Executive
shall have the title and shall report to one of the persons set forth on
Schedule A hereto.
(c) Place of Performance. During the Agreement Term,
Executive shall be based at the Company's principal executive offices in New
York City (or, if such principal executive offices are relocated, at such
relocated principal executive offices) and, in this regard, Executive shall
maintain Executive's personal residence in such city or such other location(s)
within reasonable access to Executive's place of employment, and shall not
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be required to relocate such residence to any location more than 40 miles from
such city (or such relocated principal executive offices).
3. Compensation and Benefits.
(a) Base Salary. The Company agrees to pay to
Executive for employment hereunder a base salary ("Base Salary") at the annual
rate of $300,000 during the Agreement Term, payable in installments consistent
with the Company's payroll practices; provided, however, that the Board of
Directors will review such Base Salary not later than November 15, 1998 and may,
in its discretion, increase such Base Salary based upon its assessment of
Executive's performance or other factors; provided, that such Base Salary, as
increased from time to time, shall not be reduced.
(b) Benefits and Perquisites; Bonus. Executive shall
be entitled to participate in, to the extent Executive is otherwise eligible
under the terms thereof, the benefit plans and programs, and receive the
benefits and perquisites, generally provided to executives of the same level and
responsibility as Executive. Nothing in this Agreement shall preclude the
Company from terminating or amending from time to time any employee benefit plan
or program. Executive shall be eligible for an annual bonus, not to exceed an
amount equal to fifty percent (50%) of Executive's Base Salary, at such times
and in such amounts as shall be determined at the discretion of the Chief
Executive Officer and the Board of Directors of the Company based on their
assessment of Executive's performance of his duties and on the financial
performance of the Company; provided, however, that Executive shall receive a
minimum bonus for calendar year 1997 in the amount of $40,000 ("Guaranteed 1997
Bonus"). Subject to the minimum amount for 1997, such bonus shall be based on
the same criteria as the incentive bonus program for the Company's other senior
executives, based upon criteria set forth in the Company's Senior Level Bonus
Plan 1997 Summary, or such Bonus Plan as is in effect in any future year.
(c) Travel and Business Expenses. Upon submission of
itemized expense statements in the manner specified by the Company, Executive
shall be entitled to reimbursement for reasonable travel and other reasonable
business expenses duly incurred by Executive in the performance of Executive's
duties under this Agreement in accordance with the policies and procedures
established by the Company from time to time for executives of the same level
and responsibility as Executive.
(d) Grant of Option and Terms Thereof; Company Policy
on Pooling of Interests Restrictions. Simultaneous with the commencement of
employment, Executive shall be granted an option (the "Option"), pursuant to the
Company's 1995 Stock Incentive Plan or the 1997 Stock Incentive Plan (together,
the "Plan"), to purchase three hundred fifty thousand (350,000) shares of the
Company's common stock (the "Option Shares"). The exercise price for each Option
Share shall be the per share Fair Market Value (as such term is defined in the
Plan) on the date of the grant and the Option shall vest in four equal annual
installments commencing one year from the date of grant. The terms (including
exercisability) of the Option shall be governed by the Plan, as well as the
applicable option
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agreement entered into pursuant to the terms of such plan. The Board of
Directors of the Company has approved such grant.
Executive acknowledges and agrees to abide by the Company's
policy that prohibits executive officers who may be deemed affiliates under SEC
policy interpretations, from selling any shares of the Company's Common Stock at
a time when such officer is advised by the Chief Executive Officer or the Chief
Financial Officer (based upon advice from the Company's independent certified
public accountants) that such sale could adversely affect pooling of interests
accounting treatment of any acquisition or other business combination engaged in
or to be engaged in by the Company. If requested, Executive will execute an
"affiliate" agreement confirming such agreement in connection with any such
acquisition or business combination.
(e) No Other Compensation or Benefits; Payment. The
compensation and benefits specified in Sections 3 and 5 of this Agreement shall
be in lieu of any and all other compensation and benefits. Payment of all
compensation and benefits to Executive hereunder shall be made in accordance
with the relevant Company policies in effect from time to time, including normal
payroll practices, and shall be subject to all applicable employment and
withholding taxes.
(f) Cessation of Employment. In the event Executive
shall cease to be employed by the Company for any reason, then Executive's
compensation and benefits shall cease on the date of such event, except as
otherwise provided herein or in any applicable employee benefit plan or program.
4. Exclusive Employment; Noncompetition.
(a) No Conflict; No Other Employment. During the
period of Executive's employment with the Company, Executive shall not: (i)
engage in any activity which conflicts or interferes with or derogates from the
performance of Executive's duties hereunder nor shall Executive engage in any
other business activity, whether or not such business activity is pursued for
gain or profit, except as approved in advance in writing by the Chief Executive
Officer or the Board of Directors of the Company; or (ii) accept any other
full-time or substantially full-time employment, whether as an executive or
consultant or in any other capacity, and whether or not compensated therefor.
(b) No Competition. Without limiting the generality
of the provisions of Sections 2(b) or 4(a), during the Agreement Term and any
period thereafter during which Executive is receiving severance payments
pursuant to Section 5(d), Executive shall not, directly or indirectly, own,
manage, operate, join, control, participate in, invest in or otherwise be
connected or associated with, in any manner, including as an officer, director,
employee, independent contractor, partner, consultant, advisor, agent,
proprietor, trustee or investor, any Competing Business located in the United
States; provided, however, that ownership of 1% or less of the stock or other
securities of a corporation, the stock of which is listed on a national
securities exchange or is quoted on The Nasdaq Stock Market, shall not
constitute a breach of this Section 4, so long as Executive does not in fact
have the
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power to control, or direct the management of, or is not otherwise associated
with, such corporation; provided further, however, that if Executive's
employment is terminated under Section 5(d), then the provisions of this Section
4(b) shall remain in effect only so long as and during the period in which the
Company continues to pay to Executive amounts as severance pursuant to Section
5(d).
For purposes hereof, the term "Competing Business"
shall mean any business or venture which develops, manufactures, publishes,
licenses, sells, distributes or supplies computer software or video games (or
any related books or other intellectual property or merchandise relating
thereto) for commercial use, whether for retail distribution, by direct
marketing, electronically, by license to others, or otherwise; or any other
business which is substantially similar to the whole or any significant part of
the business conducted by the Company.
(c) No Solicitation of Employment. During the
Agreement Term and for a period of two years thereafter, Executive shall not
solicit or encourage any other employee to leave the Company for any reason, nor
assist any business in doing so, nor employ such an employee in a Competing
Business or any other business.
(d) Company Customers. Executive shall not, during
the Agreement Term and any period thereafter during which Executive is receiving
severance payments pursuant to Section 5(d), except as required by the Company
in the performance by Executive of his duties under this Agreement, directly or
indirectly, contact, solicit or do business with (i) Wal-Mart Stores, Inc.,
Target Stores, Caldor, Phar-mor, Best Buy, Neostar, Kmart, Office Depot (or any
of their respective affiliated operations), for the purpose of selling computer
software, video games or any other product then sold by the Company or proposed
to be sold during the Agreement Term; (ii) any "customers" (as defined below) of
the Company for the purpose of selling computer software, video games or any
other product then sold by the Company or proposed to be sold during the
Agreement Term; or (iii) any supplier, licensor or licensee of the Company (or
any such supplier, licensor or licensee solicited by the Company prior to or
during the Agreement Term) with respect to purchasing or licensing computer
software, video games or other intellectual property to or from such person.
For the purposes of the provisions of this Section 4(d), "customer" shall
include any entity that purchased or licensed computer software, video games or
any other product from the Company during, or prior to, the Agreement Term. The
term "customer" also includes any former customer or potential customer of the
Company which the Company has solicited prior to or during such Agreement Term,
for the purpose of selling computer software, video games or any other product
then sold by the Company or proposed to be sold during the Agreement Term.
5. Termination of Employment.
(a) Termination. The Company may terminate
Executive's employment for Cause (as defined below) or for any breach of this
Agreement, in which case
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the provisions of Section 5(b) shall apply. The Company may also terminate
Executive's employment in the event of Executive's Disability (as defined
below), in which case the provisions of Section 5(c) shall apply. The Company
may also terminate the Executive's employment for any other reason by written
notice to Executive, in which case the provisions of Section 5(d) shall apply.
If Executive's employment is terminated by reason of Executive's death,
retirement or voluntary resignation, the provisions of Section 5(b) shall apply.
(b) Termination for Cause; Termination by Reason of
Death or Retirement or Voluntary Resignation. In the event that Executive's
employment hereunder is terminated during the Agreement Term (x) by the Company
for Cause (as defined below), (y) by reason of Executive's death or retirement
or (z) by reason of Executive's voluntary resignation, then the Company shall
pay to Executive, within thirty (30) days of the date of such termination, only
the Base Salary through such date of termination. For purposes of this
Agreement, "Cause" shall mean (i) conviction of any crime (whether or not
involving the Company) constituting a felony in the jurisdiction involved; (ii)
engaging in any substantiated act involving moral turpitude; (iii) gross neglect
or willful misconduct in the performance of Executive's duties hereunder; (iv)
willful failure or refusal to perform such duties as may be delegated to
Executive commensurate with Executive's position as set forth in Section 2
hereof; or (v) material breach of any provision of this Agreement by Executive;
provided, however, that with respect to clause (iii), clause (iv) and clause
(v), Executive shall have received written notice from the Company setting forth
the manner in which he has been grossly negligent or engaged in misconduct, he
has willfully failed to perform his duties prior to such notice or has
materially breached any provision of this Agreement, and Executive shall not
have cured such gross neglect, misconduct, willful failure or refusal to perform
or breach, to the extent curable, within 10 business days of such notice;
provided, however, Executive's good faith inability to perform shall not
constitute Executive's wilful failure to perform or a material breach of any
provision of this Agreement.
(c) Disability. If, as a result of Executive's
incapacity due to physical or mental illness, Executive shall have been absent
from Executive's duties hereunder on a full time basis for either (i) one
hundred twenty (120) days within any three hundred sixty-five (365) day period,
or (ii) ninety (90) consecutive days, and within thirty (30) days after written
notice of termination is given shall not have returned to the performance of
Executive's duties hereunder on a full time basis, the Company may terminate
Executive's employment hereunder for "Disability". In that event, the Company
shall pay to Executive, within thirty (30) days, of the date of such
termination, only the Base Salary through such date of termination. During any
period that Executive fails to perform Executive's duties hereunder as a result
of incapacity due to physical or mental illness (a "Disability Period"),
Executive shall continue to receive the compensation and benefits provided by
Section 3 hereof until Executive's employment hereunder is terminated; provided,
however, that the amount of compensation and benefits received by Executive
during the Disability Period shall be reduced by the aggregate amounts, if any,
payable to Executive under disability benefit plans and programs of the Company
or under the Social Security disability insurance program.
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(d) Termination By Company For Any Other Reason.
(i) In the event that Executive's employment
hereunder is terminated by the Company during the Agreement Term for any reason
other than as provided in Sections 5(b) or 5(c) hereof, or this Agreement
expires and the Company terminates the employment of Executive for any reason
other than as provided in Sections 5(b) or 5(c) hereof had this Agreement
remained in effect, then the Company shall pay to Executive within thirty (30)
days of the date of such termination, the Base Salary through such date of
termination and, in lieu of any further compensation and benefits for the
balance of the Agreement Term, or otherwise, severance pay equal to the Base
Salary for a period of one (1) year from the effective date of such termination,
which severance pay shall be paid commencing with such date of termination at
the times and in the amounts such Base Salary would have been paid in the normal
course hereunder. Under such circumstances, except as set forth below, for the
balance of the one-year period, Executive shall also continue to participate in
and receive the benefits and perquisites provided for in Sections 3(b) and 3(c)
hereof (including the Guaranteed 1997 Bonus, but excluding any other bonus and
stock options) to the same extent as if Executive's employment hereunder had not
been terminated; provided, however, that in the event that Executive shall
breach Sections 4 or 6 hereof, in addition to any other remedies the Company may
have in the event Executive breaches this Agreement, the Company's obligation
pursuant to this Section 5(d) to continue such salary, Guaranteed 1997 Bonus,
benefits and perquisites shall cease and Executive's rights thereto shall
terminate and shall be forfeited. In addition, the Company shall provide
out-placement services to Executive, using a mutually acceptable out-placement
firm, for up to six (6) months from the date of termination under this Section
5(d); provided, however, that the cost to the Company for such services shall
not exceed $20,000. Any changes by the Company in Executive's title, duties,
reporting responsibility or place of performance as set forth in Section 2
hereof, without the consent of Executive, shall be deemed a termination pursuant
to this Section 5(d).
(ii) If, within one year following a Change of
Control, as hereafter defined, (A) Executive's employment is terminated by the
Company or its successor for any reason other than as provided in Sections 5(b)
or (c) (including a deemed termination by reason of any changes referred to in
the last sentence of Section 5(d)(i)), or (B) Executive is required to relocate
to an office of the Company located outside the Tri-State Area (i.e., New York,
New Jersey and Connecticut) (whether or not such office is the principal
executive office of the Company), then at the time of such event, all options
previously granted to Executive pursuant to the Company's 1995 Stock Incentive
Plan or the 1997 Stock Incentive Plan, including options assumed, or substituted
therefor, by the Company or its successor, shall immediately vest and be
exercisable by Executive in full, and Executive shall thereafter be entitled to
exercise such options for the balance of their respective terms. For purposes
hereof, Change of Control shall mean any of the following occurrences:
(1) any "person" as such term is used in Section 13(d) and 14(d)
of the Securities Exchange Act of 1934 ("Exchange Act") (other
than the Company or any trustee or other fiduciary holding
securities under an employee benefit plan of the Company and
other than Xxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxx Xxxxx and
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their respective spouses or children or trusts for such
children), is or becomes the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 50% or more of the
combined voting power of the Company's then outstanding
securities (other than as a result of a merger or
consolidation covered by clause (3)(i) below in connection
with a merger involving the Company which would result in
voting securities of the Company outstanding immediately prior
thereto continuing to represent more than 50% of the combined
voting power of the voting securities of such "person"
outstanding immediately after such merger or consolidation);
(2) during any period of two consecutive years, individuals who at
the beginning of such period constitute the Board of Directors
of the Company, and any new director (other than a director
designated by a person who has entered into an agreement with
the Company to effect a transaction described in clause (1),
(3) or (4) of this definition) whose election by the Board or
nomination for election by the Company's stockholders was
approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at
the beginning of the period or whose election or nomination
for election was previously so approved, cease for any reason
to constitute at least a majority thereof;
(3) the stockholders of the Company approve a merger or
consolidation of the Company with any other entity, other than
(i) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of
the surviving entity) more than 50% of the combined voting
power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or
consolidation or (ii) a merger or consolidation effected to
implement a recapitalization of the Company (or similar
transaction) in which no "person" (as hereinabove defined)
acquires more than 50% of the combined voting power of the
Company's then outstanding securities; or
(4) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the
Company's assets.
(e) No Further Liability; Release. Payment made and
performance by the Company in accordance with this Section 5 shall operate to
fully discharge and release the Company and its directors, officers, employees,
subsidiaries, affiliates, stockholders, successors, assigns, agents and
representatives from any further obligation or liability with respect to
Executive's employment and termination of employment. Other than paying
Executive's Base Salary through the date of termination of Executive's
employment and making any severance payment and continuing benefits and
perquisites pursuant to and in
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accordance with this Section 5 (as applicable), the Company and its directors,
officers, employees, subsidiaries, affiliates, stockholders, successors,
assigns, agents and representatives shall have no further obligation or
liability to Executive or any other person under this Agreement. The Company
shall have the right to condition the payment of any severance or other amounts
pursuant to Sections 5(c) or 5(d) hereof upon the delivery by Executive to the
Company of a release in form and substance satisfactory to the Company of any
and all claims Executive may have against the Company and its directors,
officers, employees, subsidiaries, affiliates, stockholders, successors,
assigns, agents and representatives arising out of or related to Executive's
employment by the Company and termination of such employment.
(f) Option Term in the Event of Death or Disability.
In the event that this Agreement is terminated by reason of Executive's death or
disability, he or his estate, as the case may be, shall be entitled to exercise
any Options which have vested as of the date of such termination, for a period
of one year from such termination, and the applicable option agreement between
the Company and Executive shall reflect such extension.
6. Confidential Information.
(a) Existence of Confidential Information. The
Company owns and has developed and compiled, and will develop and compile,
certain proprietary techniques and confidential information which have great
value to its business (referred to in this Agreement, collectively, as
"Confidential Information"). Confidential Information includes not only
information disclosed by the Company to Executive, but also information
developed or learned by Executive during the course or as a result of employment
with the Company, which information shall be the property of the Company.
Confidential Information includes all information that has or could have
commercial value or other utility in the business in which the Company is
engaged or contemplates engaging, and all information of which the unauthorized
disclosure could be detrimental to the interests of the Company, whether or not
such information is specifically labelled as Confidential Information by the
Company. By way of example and without limitation, Confidential Information
includes any and all information developed, obtained, licensed by or to or owned
by the Company concerning trade secrets, techniques, know-how (including
designs, plans, procedures, merchandising, marketing, distribution and
warehousing know-how, processes, and research records), software, computer
programs and designs, development tools, and any other intellectual property
created, used or sold (through a license or otherwise) by the Company,
Electronic Data Information know-how and processes, innovations, discoveries,
improvements, research, development, test results, reports, specifications,
data, formats, marketing data and plans, business plans, strategies, forecasts,
unpublished financial information, orders, agreements and other forms of
documents, price and cost information, merchandising opportunities, expansion
plans, store plans, budgets, projections, customer, supplier, licensee, licensor
and subcontractor identities, characteristics, agreements and operating
procedures, and salary, staffing and employment information.
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(b) Protection of Confidential Information. Executive
acknowledges and agrees that in the performance of duties hereunder the Company
discloses to and entrusts Executive with Confidential Information which is the
exclusive property of the Company and which Executive may possess or use only in
the performance of duties for the Company. Executive also acknowledges that
Executive is aware that the unauthorized disclosure of Confidential Information,
among other things, may be prejudicial to the Company's interests, an invasion
of privacy and an improper disclosure of trade secrets. Executive shall not,
directly of indirectly, use, make available, sell, disclose or otherwise
communicate to any corporation, partnership, individual or other third party,
other than in the course of Executive's assigned duties and for the benefit of
the Company, any Confidential Information, either during the Agreement Term or
thereafter. In the event Executive desires to publish the results of Executive's
work for or experiences with the Company through literature, interviews or
speeches, Executive will submit requests for such interviews or such literature
or speeches to the Chief Executive Officer of the Company at least fourteen (14)
days before any anticipated dissemination of such information for a
determination of whether such disclosure is in the best interests of the
Company, including whether such disclosure may impair trade secret status or
constitute an invasion of privacy. Executive agrees not to publish, disclose or
otherwise disseminate such information without the prior written approval of the
Chief Executive Officer of the Company.
(c) Delivery of Records, Etc. In the event
Executive's employment with the Company ceases for any reason, Executive will
not remove from the Company's premises without its prior written consent any
records (written or electronic), files, drawings, documents, equipment,
materials and writings received from, created for or belonging to the Company,
including those which relate to or contain Confidential Information, or any
copies thereof. Upon request or when employment with the Company terminates,
Executive will immediately deliver the same to the Company.
7. Assignment and Transfer.
(a) Company. This Agreement shall inure to the
benefit of and be enforceable by, and may be assigned by the Company to, any
purchaser of all or substantially all of the Company's business or assets, any
successor to the Company or any assignee thereof (whether direct or indirect, by
purchase, merger, consolidation or otherwise). The Company will require any such
purchaser, successor or assignee to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such purchase, succession or assignment had taken
place.
(b) Executive. Executive's rights and obligations
under this Agreement shall not be transferable by Executive by assignment or
otherwise, and any purported assignment, transfer or delegation thereof shall be
void; provided, however, that if Executive shall die, all amounts then payable
to Executive hereunder shall be paid in accordance with the terms of this
Agreement to Executive's devisee, legatee or other designee or, if there be no
such designee, to Executive's estate.
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8. Miscellaneous.
(a) Other Obligations. Executive represents and
warrants that neither Executive's employment with the Company nor Executive's
performance of Executive's obligations hereunder will conflict with or violate
or otherwise are inconsistent with any other obligations, legal or otherwise,
which Executive may have.
(b) Nondisclosure; Other Employers. Executive will
not disclose to the Company, or use, or induce the Company to use, any
proprietary information, trade secrets or confidential business information of
others. Executive represents and warrants that Executive has returned all
property, proprietary information, trade secrets and confidential business
information belonging to all prior employers.
(c) Cooperation. Following termination of employment
with the Company, Executive shall cooperate with the Company, as requested by
the Company, to affect a transition of Executive's responsibilities and to
ensure that the Company is aware of all matters being handled by Executive.
(d) No Duty to Mitigate. Executive shall be under no
duty to mitigate with respect to any severance or other amounts payable pursuant
to Sections 5(c) or 5(d) hereof.
(e) Protection of Reputation. During the Agreement
Term and thereafter, the Company and Executive agree that neither will take any
action which is intended, or would reasonably be expected, to harm the other or
its reputation or which would reasonably be expected to lead to unwanted or
unfavorable publicity to the other.
(f) Governing Law. This Agreement, including the
validity, interpretation, construction and performance of this Agreement, shall
be governed by and construed in accordance with the internal laws of the State
of New York, without regard to principles of conflicts of law. All actions and
proceedings relating directly or indirectly to this Agreement shall be litigated
in any state court or federal court located in New York, New York. The parties
hereto expressly consent to the jurisdiction of any such court and to venue
therein and consent to the service of process in any such action or proceeding
by certified or registered mailing of the summons and complaint therein directed
to Executive at the address as provided in Section 8(m) hereof and to the
Company's designated agent for service of process (which initially shall be GT
Interactive Software Corp., 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn:
Director of Legal Affairs; which agent may be changed by the Company upon thirty
(30) days' prior written notice to Executive).
(g) Entire Agreement. This Agreement (including the
Exhibit hereto) contains the entire agreement and understanding between the
parties hereto in respect of the subject matter hereof and supersedes, cancels
and annuls any prior or contemporaneous written or oral agreements,
understandings, commitments and practices between them respecting the subject
matter hereof, including all prior employment
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agreements, if any, between the Company and Executive, which agreement(s) hereby
are terminated and shall be of no further force or effect.
(h) Amendment. This Agreement may be amended only by
a writing which makes express reference to this Agreement as the subject of such
amendment and which is signed by Executive and, on behalf of the Company, by its
duly authorized officer.
(i) Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
person, place or circumstance, shall be held to be invalid, unenforceable or
void by a court of competent jurisdiction, the remainder of this Agreement and
such term, provision, covenant or condition shall remain in full force and
effect, and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, to the extent necessary to render the same and the remainder of this
Agreement valid, enforceable and lawful. In this regard, Executive acknowledges
that the provisions of Sections 4 and 6 are reasonable and necessary for the
protection of the Company.
(j) Construction. The headings and captions of this
Agreement are provided for convenience only and are intended to have no effect
in construing or interpreting this Agreement. The language in all parts of this
Agreement shall be in all cases construed according to its fair meaning and not
strictly for or against the Company or Executive. The use herein of the word
"including," when following any general provision, sentence, clause, statement,
term or matter, shall be deemed to mean "including, without limitation". As used
herein, "Company" shall mean the Company and its subsidiaries and any purchaser
of, successor to or assignee (whether direct or indirect, by purchase, merger,
consolidation or otherwise) of all or substantially all of the Company's
business or assets which is obligated to perform this Agreement by operation of
law, agreement pursuant to Section 7 hereof or otherwise. As used herein, the
words "day" or "days" shall mean a calendar day or days.
(k) Nonwaiver. Neither any course of dealing nor any
failure or neglect of either party hereto in any instance to exercise any right,
power or privilege hereunder or under law shall constitute a waiver of any other
right, power or privilege or of the same right, power or privilege in any other
instance. All waivers by either party hereto must be contained in a written
instrument signed by the party to be charged and, in the case of the Company, by
its duly authorized officer.
(l) Remedies for Breach. The parties hereto agree
that Executive is obligated under this Agreement to render personal services
during the Agreement Term of a special, unique, unusual, extraordinary and
intellectual character, thereby giving this Agreement peculiar value, and, in
the event of a breach or threatened breach of any covenant of Executive herein,
the injury or imminent injury to the value and the goodwill of the Company's
business could not be reasonably or adequately compensated in damages in an
action at law. Accordingly, Executive expressly acknowledges that the Company
shall be
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entitled to specific performance, injunctive relief or any other equitable
remedy against Executive, without the posting of a bond, in the event of any
breach or threatened breach of any provision of this Agreement by Executive
(including Sections 4 and 6 hereof). Without limiting the generality of the
foregoing, if Executive breaches Sections 4 or 6 hereof, such breach will
entitle the Company to enjoin Executive from disclosing any Confidential
Information to any Competing Business, to enjoin such Competing Business from
receiving Executive or using any such Confidential Information and/or to enjoin
Executive from rendering personal services to or in connection with such
Competing Business. The rights and remedies of the parties hereto are cumulative
and shall not be exclusive, and each such party shall be entitled to pursue all
legal and equitable rights and remedies and to secure performance of the
obligations and duties of the other under this Agreement, and the enforcement of
one or more of such rights and remedies by a party shall in no way preclude such
party from pursuing, at the same time or subsequently, any and all other rights
and remedies available to it.
(m) Notices. Any notice, request, consent or approval
required or permitted to be given under this Agreement or pursuant to law shall
be sufficient if in writing, and if and when sent by certified or registered
mail, return receipt requested, with postage prepaid, to Executive's residence
(as reflected in the Company's records or as otherwise designated by Executive
on thirty (30) days' prior written notice to the Company) or to the Company's
principal executive office, attention: President (with copies to the Director of
Legal Affairs), as the case may be. All such notices, requests, consents and
approvals shall be effective upon being deposited in the United States mail.
However, the time period in which a response thereto must be given shall
commence to run from the date of receipt on the return receipt of the notice,
request, consent or approval by the addressee thereof. Rejection or other
refusal to accept, or the inability to deliver because of changed address of
which no notice was given as provided herein, shall be deemed to be receipt of
the notice, request, consent or approval sent.
(n) Assistance in Proceedings, Etc. Executive shall,
without additional compensation, during and after expiration of the Agreement
Term, upon reasonable notice, furnish such information and proper assistance to
the Company as may reasonably be required by the Company in connection with any
legal or quasi-legal proceeding, including any external or internal
investigation, involving the Company or any of its affiliates or in which any of
them is, or may become, a party.
(o) Survival. Cessation or termination of Executive's
employment with the Company shall not result in termination of this Agreement.
The respective obligations of Executive and rights and benefits afforded to the
Company as provided in this Agreement shall survive cessation or termination of
Executive's employment hereunder. This Agreement shall not terminate upon, and
shall remain in full force and effect following, expiration of the Agreement
Term and all rights and obligations of the parties hereto as and to the extent
provided herein shall survive such expiration.
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IN WITNESS WHEREOF, the Company has caused this Agreement to
be duly executed on its behalf by an officer thereunto duly authorized and
Executive has duly executed this Agreement, all as of the date and year first
written above.
GT Interactive Software Corp. EXECUTIVE:
By: /s/ Xxxxxx Xxxxxxxxxx /s/ Xxxxx Xxxxxxxx
------------------------------- ----------------------------------------
Name: Xxxxxx Xxxxxxxxxx Xxxxx Xxxxxxxx
Title: Chief Executive Officer
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14
Schedule A
Title: Executive Vice President and Chief Operating Officer
Reporting to: The Chairman of the Board, the Chief Executive Officer or the
President of the Company.
Boards of Directors: Playboy Enterprises, Inc.
Dunham's Athleisure Corp.
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