AGREEMENT made November 21, 1995, between PARADIGM
ENTERTAINMENT Co., a Delaware corporation ("Paradigm"), and XXX XXXXXXXX
("Xxxxxxxx").
R E C I T A L S
Paradigm desires to retain Xxxxxxxx'x experience and abilities
in connection with the operation of the business conducted by Paradigm and has
offered to engage Xxxxxxxx to render consultative and advisory services to it,
and
Xxxxxxxx desires to accept such engagement, upon the terms and
conditions set forth below.
NOW, THEREFORE, it is agreed as follows:
A G R E E M E N T
1. TERM AND DUTIES.
(a) Paradigm hereby engages Xxxxxxxx for a period beginning on
November 21, 1995, and ending on November 20, 1998, as a general advisor and
consultant to management on matters pertaining to Paradigm's business. Xxxxxxxx
shall devote so much of his time, attention and energies as he shall deem
reasonable required to perform his duties hereunder, subject to his
availability, reasonable vacations compatible with his position and with due
regard to the preservation of his health. It is understood that Xxxxxxxx'x
duties are to be conducted in the City and State of New York.
(b) Paradigm may only terminate Xxxxxxxx'x engagement for
Cause (as defined below) by giving written notice of termination to Xxxxxxxx as
herein provided, and the date of termination of this Agreement will be the
effective date of such notice. As used herein, "Cause" shall mean only
Xxxxxxxx'x conviction of a felony under federal or state law.
(c) Xxxxxxxx may terminate this Agreement either (i) in the
event of a Change in Control (as hereinafter defined) of Paradigm, or (ii) for
Good Reason (as hereinafter defined) by giving notice of termination to Paradigm
(the "Executive Notice"). The date of termination of this Agreement pursuant to
this Section l(c) shall be the effective date of such Executive Notice.
(d) In the event that this Agreement is terminated by Paradigm
(except in the case of a termination for Cause) or by Xxxxxxxx pursuant to
Section 1(c) hereof, Paradigm will pay to Xxxxxxxx in a lump sum payment within
15 days of the date of termination an amount equal to the amount of compensation
Xxxxxxxx would have received but for such termination for the remainder of the
original term hereof.
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(e) Xxxxxxxx will not be required to mitigate the amount of
any payment provided for in Section l(d) hereof by seeking other engagements or
employment nor will the amount of any payment provided for in Section 1(d) be
reduced by any compensation earned by Xxxxxxxx as the result of engagement or
employment by another person or entity after the date of termination.
(f) For purposes of this Agreement, a "Change in Control" of
Paradigm means (i) the sale by Paradigm of all or substantially all of its
assets to a single purchaser or to a group of purchasers in related
transactions; (ii) the merger or consolidation of Paradigm with a third party,
as a result of which Paradigm is not the surviving entity (as defined in Rule
13d-3 under the Securities Exchange Act of 1934); or (iii) securities of
Paradigm representing 33 1/3% or more of the combined voting power of the
Paradigm's outstanding securities are sold or otherwise disposed of (other than
pursuant to a private placement of securities on or before December 1, 1995 or a
public offering of such securities) in one or a related series of transactions
by Paradigm or current holders of such securities to a third person not
affiliated with or controlled by such holder or holders.
(g) For purposes of this Agreement, termination of this
Agreement by Xxxxxxxx for "Good Reason" means a termination:
(i) based on the assignment to Xxxxxxxx by the Board
of Directors of Paradigm of any duties inconsistent with his positions, duties,
responsibilities and status as an senior management executive with Paradigm; or
(ii) based on failure of Paradigm to pay compensation
or other amounts due hereunder when due following written notice and ten (10)
days to cure such default.
(h) Xxxxxxxx is currently employed on a full-time basis as
chief executive officer of Momentum Enterprises and related companies
(collectively, "Momentum") and intends to remain so employed. He may also be
engaged from time to time hereafter by other companies It is acknowledged that
Momentum is involved in the entertainment industry and may have interests in
businesses similar to that of Paradigm. It is understood and agreed that in no
event shall such employment of Xxxxxxxx by Momentum or any other company be
deemed a conflict of interest with Xxxxxxxx'x duties hereunder. It is further
understood and agreed that such employment by Momentum or any other company
shall severely limit the availability of Xxxxxxxx to Paradigm, and that such
limited availability shall in no event be deemed a breach or default by him
hereunder.
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2. DISABILITY WAIVER. Paradigm recognizes that Xxxxxxxx'x past
experience in the entertainment industry has created unique goodwill to Paradigm
in the operation of its business. Paradigm desires to retain Xxxxxxxx'x services
and his other agreements herein set forth, even though Xxxxxxxx may become
disabled or incapacitated. Accordingly, it is expressly understood that
Xxxxxxxx'x inability to render services to Paradigm because of absences, or
temporary or permanent illness, disability, or incapacity, or for any other
reasonable cause, shall not constitute a failure to perform his obligations
hereunder and shall not be deemed a breach or default by him.
3. COMPENSATION.
(a) Paradigm shall pay to Xxxxxxxx, as full compensation for
any and all services that Xxxxxxxx may render to Paradigm, the sum of $12,500
per month, to be paid quarterly or on the first day of each month during the
term of this Agreement starting December 1, 1995 as he shall determine. It is
agreed that the payment due on December 1, 1995, will be $16,666.66 (containing
an adjustment for the term hereof occurring in November, 1995), and that the
last payment hereunder will be likewise adjusted.
(b) Paradigm will reimburse Xxxxxxxx for all expenses
reasonably incurred by Xxxxxxxx in connection with the performance by Xxxxxxxx
of his duties (including business travel, which shall include business class air
transportation, accommodations, and ground transportation for any travel outside
of the City of New York and entertainment expenses), in accordance with
Paradigm's policy with respect thereto as in effect from time to time.
4. DEATH BENEFIT. Should Xxxxxxxx die during the term of this
Agreement, this Agreement shall terminate as of the last day of the month of his
death. Paradigm shall, for a period of three months after Xxxxxxxx'x death, pay
to his legal representatives, or to his surviving widow (provided that Xxxxxxxx
has so instructed Paradigm in writing prior to his death) the sum of $12,500, to
be paid on the first day of each month during the three-month period. If
Xxxxxxxx dies later than September 1. 1997, however, the $12,500 monthly
payments to his legal representatives or widow, as the case may be, shall be
made only until (and including) November 1, 1998.
5. RESTRICTIVE COVENANT. Xxxxxxxx agrees that during the term
of employment, Xxxxxxxx shall promptly reveal to Paradigm's Board of Directors
all material matters pertaining to Paradigm's business or interest. Xxxxxxxx
shall not accept full-time employment from any other concern which is engaged as
its principal business in a the manufacturing and distribution of recorded
popular music unless he first resigns as a consultant to Paradigm and terminates
this Agreement: provided, however, that the foregoing restriction shall not be
deemed to prohibit Xxxxxxxx from (a) continuing in any business in which he is
now involved or in which he held, directly or indirectly, any interest during
the last three years, (b) continuing to work for Momentum, regardless of the
business in which Momentum may be engaged.
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6. ARBITRATION. Any controversy or claim arising out of or
relating to this Agreement shall be settled by arbitration in accordance with
the rules of the American Arbitration Association. Any judgment upon the award
rendered in such arbitration may be entered in any court of competent
jurisdiction. In the event the Xxxxxxxx prevails in any such proceeding,
Paradigm will pay to Xxxxxxxx on demand all costs and expenses (including costs
of investigation) incurred by Xxxxxxxx in connection therewith (including
reasonable attorneys' fees).
7. WAIVER, MODIFICATION, OR CANCELLATION. Any waiver,
alteration, or modification of any of the-provisions of this Agreement, or its
cancellation or replacement, shall not be valid unless in writing and signed by
the parties.
8. CONSTRUCTION. This Agreement shall be governed by the laws
of the State of New York, without regard to principles of conflict of laws.
9. ASSIGNMENT. This Agreement shall inure to the benefit of
and bind the parties and their respective legal representatives, successors, and
assigns.
10. NOTICES. All notices, requests, demands an other
communications hereunder shall be in writing and shall be deemed duly given when
delivered by hand, or when delivered if mailed by registered or certified mail,
postage prepaid, or sent by private express mail to the respective addresses as
follows:
If to Paradigm, to: Paradigm Music Entertainment Co.
00 Xxxxxx Xxxxx
0xx xxxxx
Xxx Xxxx, XX 00000
If to Xxxxxxxx, to: Momentum Enterprises
00 Xxxxxx Xxxxx
0xx xxxxx
Xxx Xxxx, XX 00000
or to such other addresses as a party hereto shall have designated by like
notice to the other parties hereto.
11. ENTIRE AGREEMENT. This Agreement supersedes all agreements
previously made between the parties relating to its subject matter. There are no
other understandings or agreements.
12. NON-WAIVER. No delay or failure by either party in
exercising any right under this Agreement, and no partial or single exercise of
that right, shall constitute a waiver of that or any other right.
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13. HEADINGS. Headings in this Agreement are for convenience
only and shall not be used to interpret or construe its provisions.
14. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement the day and year first above written.
PARADIGM MUSIC ENTERTAINMENT CO.
By: ____________________________________
Xxxxxx XxXxxxxxxx, President
____________________________________
Xxx Xxxxxxxx
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