Exhibit 10.14
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of the 1st day of
September, 2000, by and between Cinema Ride, Inc., a Delaware corporation
(hereinafter the "Company"), and Xxxxx Xxxxxxx, an individual (hereinafter
"Employee").
WITNESSETH
WHEREAS, the Company desire to retain the services of Employee, and 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. The Company hereby engages Employee, for
the period hereinafter set forth, to serve as and hold the offices of Chairman
of the Board, President and Chief Executive Officer, and to perform the duties
of such offices as provided in the Bylaws of the Company and as directed by the
Board of Directors of the Company. Employee agrees to serve in such capacity and
to do and perform the service, acts, or things necessary to carry out the duties
of such offices, and such other duties, not inconsistent with such offices and
Employee's position as an executive officer of the Company. Employee shall
report only to the Board of Directors of the Company. It is expressly agreed and
acknowledged that employment in the capacity of the aforementioned offices was a
material inducement to Employee to enter into this Agreement. The Company
further agrees and acknowledges that election, and being retained in office, as
a director was a material inducement to Employee to enter into this Agreement.
The Company agrees to cause Employee to be nominated as a director at any and
all meetings, or any actions of the stockholders of the Company for the purpose
of electing directors, and to use the Company's best efforts to cause Employee
to be elected and retained in office as a director throughout the term of this
Agreement.
2. Term. The term of employment pursuant to this Agreement shall be for a
period of three (3) years, commencing on September 1, 2000 (the "Commencement
Date"), unless sooner terminated in accordance with the provisions hereof (the
"Term").
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3. Performance of Duties. Employee shall devote such time and attention to
Employee's duties as may be reasonably necessary to perform and carry out such
duties. Nothing herein contained shall be deemed to preclude Employee from
performing services to other businesses or entities not affiliated with the
Company or having personal investments and from devoting a reasonable amount of
time to the care and attention thereof, provided that the same shall in no
manner interfere with or derogate from Employee's work for the Company or
conflict with the Company's business.
Employee shall perform his duties hereunder primarily in the Los Angeles,
California area, and shall not be required to perform such duties on a regular
basis at any other location except for site visits. Employee shall not be
required to relocate without his consent.
4. Compensation.
(a) Base Salary. The Company shall pay to Employee a base salary in
the amount of Two Hundred Seventy-five Thousand Dollars ($275,000) per year
(the "Base Salary"), payable in periodic installments in accordance with
the Company's prevailing policy for compensating personnel, but not less
often than semi monthly. On each yearly anniversary of the Commencement
Date (September 1, 1997), the Base Salary shall be increased by eight
percent (8%).
(b) Earnings Bonus. In addition to the Base Salary, and any and all
other compensation, profit-sharing participating, benefits, bonuses or
other amounts due to or receivable by Employee pursuant to this Agreement,
Employee shall receive an annual bonus (the "Earnings Bonus") equal to six
(6%) percent of the Company's annual earnings before interest, taxes,
depreciation and amortization (ebitda) in excess of $500,000. A pro rata
portion of the Earnings Bonus (calculated by annualizing the year to date
ebitda and taking into account any Earnings Bonus paid for any prior
periods) shall be due and payable within forty-five (45) days of each
calendar quarter and shall be adjusted within ninety (90) days after the
calendar (or the Company's fiscal) year end. In the event that this
Agreement terminates prior to a final accounting of the Earnings Bonus, if
any, for the applicable year, Employee shall repay any overpayment within
45 days of the final accounting.
(c) Grant of Common Stock. Upon the funding of new capital or new debt
for borrowed money to the Company, the Company shall grant Employee a
number of shares of the Company's Common Stock equal to five (5%) percent
of the Company's outstanding common and preferred shares, (after such new
capital or debt and on a non-dilutive basis), for each One Million
($1,000,000) dollars of such funding, or fraction thereof on a pro rata
basis.
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(d) Options. Effective on the Commencement Date, the Company shall
grant to Employee 300,000 options to purchase shares of the Company's
Common Stock at an exercise price of $.50 per share. Such options shall be
vested equally over three (3) years (100,000 options on 9/1/01, 100,000
options on 9/1/02 and 100,000 options on (9/1/03) and shall be for a term
of five years from the Commencement Date. If Employee voluntarily leaves or
is terminated by the Company with cause, all unvested options shall
automatically terminate. If Employee is terminated without cause, the
options shall not terminate. The Company shall use its best efforts to
register the resale of the underlying shares of Common Stock on Form S-8.
(e) Performance Warrants. During the Term hereof, the Company shall
grant to Employee options to purchase shares of the Company's Common Stock
upon the following occurrences and terms:
(1) Stock price for 20 consecutive trading days at $1.00 per share:
100,000 options exercisable @ $1.00
(2) Stock price for 20 consecutive trading days at $1.50 per share:
150,000 options exercisable @ $1.50
(3) Stock price for 20 consecutive trading days at $2.00 per share:
200,000 options exercisable @ $2.00
(4) Stock price for 20 consecutive trading days at $3.00 per share:
200,000 options exercisable @ $3.00
(5) Stock price for twenty consecutive trading days at $4.00 per
share: 300,000 options exercisable @ $4.00
(6) Stock price for twenty consecutive trading days at $5.00 per
share: 300,000 options exercisable @ $5.00
(7) Upon opening each new Company owned, or joint ventured new
facility, or Mobile system put into operation: 100,000 options
exercisable at the price of the common stock on the day of
opening.
As used herein, the stock price shall be the closing bid price and shall be
appropriately adjusted for any stock splits, stock dividends, recapitalizations
etc. occurring after the Commencement Date.
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5. Expenses Reimbursement; Automobile. The services required of Employee by
this Agreement shall include the responsibility and duty of entertaining
business associates and others with whom the Company is, desires to be, or may
become engaged in business or with whom it seeks, now or in the future, to
develop or expand business relationships, or with whom it is otherwise to the
benefit of the Company to establish or maintain communications. It may also be
necessary for Employee to travel from time to time on behalf of and for the
benefit of the Company, or in furtherance of the Company's business. It is the
Company's belief that the performance of Employee's duties in such travel and
entertainment activities will produce the maximum benefits which the Company
expects to derive from Employee's services. Accordingly, the Company shall pay,
or if Employee shall have paid, shall reimburse to Employee, any and all
expenses incurred by him or for his account in the performance of his duties
hereunder, including all expenses for business, entertainment, promotion and
travel by Employee, subject only to Employee providing appropriate documentation
for such expenses. It is expressly agreed, in connection therewith, that
Employee shall be provided or reimbursed for reasonable travel and
accommodations, but no first-class air travel will be deemed reasonable, (unless
under special price offering). The Company shall provide Employee with an
automobile, reasonably commensurate with Employee's office and position, for use
by Employee in performing Employee's, duties hereunder and the Company shall be
responsible for all expenses associated with ownership/leasing of such
automobile, including, but not limited to, costs of licensing or registration,
maintenance, taxes and gasoline. Employee shall maintain such records with
respect to the use of such automobile as the Company may reasonably request.
In the event that Employee shall be deemed to have received income, for
state or federal income tax purposes, by reason of Employee's receipt of or
reimbursement for any of the benefits or expenses set forth in this Paragraph 5,
the Company shall pay or reimburse Employee for all taxes required to be paid by
Employee with respect to such income.
6. Medical and Life Insurance; Pension Benefits. The Company shall provide
or reimburse Employee for health, life (premiums up to $5,000 per year), and
disability income (up to $20,000 per month coverage) insurance. 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 the 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.
7. Vacation. During each year of the Term, Employee shall be entitled to a
vacation of six (6) weeks, without deduction of salary. Such vacation shall be
taken at such time or times during the applicable year as may be mutually
determined by Employee and the Company. Any additional vacation period shall be
determined by the Company consistent with the general customs and practices of
the Company applicable to its personnel.
8. Termination. This Agreement may be terminated by the Company only for
cause. As used herein, "cause" shall mean:
(a) Employee's willful breach of Employee's duties hereunder which
breach remains uncured for (30) days after written notice of such breach to
Employee; or
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(b) Employee's conviction of a felony involving moral turpitude.
In addition, this Agreement shall automatically be terminated upon
Employee's death or permanent disability. As used herein, "permanent disability"
shall mean Employee's complete inability to perform Employee's duties hereunder,
as determined by Employee's physician, which inability continues for more than
one-hundred eighty (180) consecutive days.
In the event that this Agreement is terminated by the Company for any
reason other than for cause or for death or permanent disability as defined
above, the Company expressly agrees and acknowledges that Employee shall be
entitled to receive the base salary, bonuses and benefits described in Section 5
of this Agreement for the remainder of the term and shall have no duty or
obligation to and/or accept other employment, or otherwise mitigate Employee's
damage resulting from such termination. The Company further agrees and
acknowledges that, in the event Employee does obtain other employment following
the Company's termination of this Agreement other than for cause, the Company
shall not be entitled to any set off or reduction in the amounts payable to
Employee hereunder as a result of any compensation paid to Employee with respect
to such new employment.
9. Indemnification. The Company shall indemnify, defend and hold Employee
harmless from and against and all claims, demands, suits, obligations,
liabilities, actions, losses, cost, expenses, fines or penalties 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 to Employee in connection with such
duties. Employee's rights under this Section 9 shall be in addition to, and not
in lieu of or, 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 or through Employee's employment by the Company (including
information conceived, originated, discovered or developed by Employee)
about the Company's products, processes, and services, including
information relating to research, development, inventions, manufacture,
purchasing, accounting, engineering, marketing, merchandising, selling
trade secrets, or customer lists, which information the Company maintains
as confidential.
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(b) Except as required in Employee's duties to the Company and then
only with the 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, comment upon or publish articles concerning, any
Confidential Information either during or at any time after the term of
this Agreement without the Company's consent.
(c) All documents, papers, notes, notebooks, memoranda, computer
files, and other written electronic records of the Company of any kind in
the possession or under the control of Employee, shall remain in the
property of the Company at all times. Upon the termination of Employee's
employment with the Company, all 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) Notice to the Employee:
Xxxxx Xxxxxxx
00000 Xxxxxxx Xxxxx
Xxxxx 000
Xxxxxx Xxxx, XX 00000
Telecopy No. (000) 000-0000
(b) Notice to the Company:
Cinema Ride, Inc.
00000 Xxxxxxx Xxxxx
Xxxxx 000
Xxxxxx Xxxx, XX 00000
Telecopy No. (000) 000-0000
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.
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12. Entire agreement and Modification. This Agreement, including the
exhibits hereto and the agreements expressly referred to herein, 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 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.
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17. Attorney's 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 abinitio, 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 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 right 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 b 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.
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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.
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 the Company, or the termination
of Employee's employment by the Company, shall be settled by binding arbitration
in Los Angeles, California, 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"
Cinema Ride, Inc.
A Delaware Corporation
By: /s/ XXXXX XXXXXXX
-----------------------------
Xxxxx Xxxxxxx, President
"Employee"
/s/ XXXXX XXXXXXX
-----------------------------
Xxxxx Xxxxxxx
