GENIUS PRODUCTS, INC.
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EXECUTIVE
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EMPLOYMENT AGREEMENT
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EMPLOYMENT AGREEMENT between Genius Products, Inc., a Nevada corporation (the
"COMPANY") and Xxxxxx Xxxxxxx, ("EXECUTIVE") dated as of February 1, 2000 (the
"EFFECTIVE DATE").
WHEREAS, the Company wishes to employ Executive and Executive wishes to be
employed by the Company , all on the terms and conditions set forth herein;
NOW THEREFORE, in consideration of the mutual covenants set forth below and for
other good and valuable consideration, the adequacy and sufficiency is hereby
acknowledged, the parties agree as follows:
1) POSITION AND TERM:
a) The Company hereby employs Executive for one (1) year from the
Effective Date (the "TERM") as Treasurer and Controller and
perform such other duties consistent with Executive's office
as may be directed by the Board of Directors, CEO, President
or Executive Vice President.
b) As an officer of the Company Executive may contractually bind
the Company subject to prior written authorization from the
CEO, President, CFO, Executive Vice President or Board of
Directors.
2) EXECUTIVE TO DEVOTE FULL TIME TO COMPANY. Executive shall devote full
time, attention, and energies to the business of the Company , and,
during this employment, will not engage in any other business activity,
regardless of whether such activity is pursued for profit, gain, or
other pecuniary advantage. Executive is not prohibited from making
personal investments in any other businesses provided those investments
do not require active involvement in the operation of said companies.
3) COMPENSATION AND BENEFITS: The Company shall pay, provide and grant to
Executive the following salary and benefits:
a) ANNUAL SALARY: $96,000
b) GRANT OF OPTIONS: A grant of options as provided in the
Non-Qualified Stock Option Agreement attached hereto as
EXHIBIT A and subject to the terms and conditions of the
Company 's Non-Qualified Stock Option Plan attached hereto as
EXHIBIT B.
c) MEDICAL AND OTHER BENEFITS: As determined by the Board in its
sole discretion, PROVIDED that all benefits are on terms no
less favorable than those provided to all other executives,
including senior executives, of the Company , including, to
the extent applicable:
i) Medical and health insurance for Executive and
dependants;
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ii) Medical expense reimbursement plan;
iii) Retirement, pension and 401(k) plans; and
iv) Life, disability and key-man insurance.
d) VACATION: Three (3) weeks per year, any unused days of which
may be rolled-over into following year; and three (3) personal
days.
e) OTHER BENEFITS/ REIMBURSEMENT: Reimbursement of reasonable
out-of-pocket expenses incurred on Company business and
pre-approved in writing by the CEO, President, or CFO of the
Company .
4) DEATH BENEFITS. Should Executive die during the term of employment, the
Company shall pay to Executive's estate any compensation and other
benefits due through the end of the month in which death occurred.
5) TERMINATION.
a) TERMINATION BY COMPANY WITHOUT CAUSE; TERMINATION BY EXECUTIVE
FOR GOOD REASON
i) Notwithstanding anything to the contrary herein and
subject to applicable law, the Company may terminate
this Agreement without cause at any time upon thirty
(30) days' prior written notice to Executive.
ii) Notwithstanding anything to the contrary herein,
Executive may terminate this Agreement for Good
Reason at any time upon thirty (30) days' prior
written notice to the Company . "GOOD REASON" means:
(1) the assignment to Executive of any duties
inconsistent with his duties described in
Section 1) above or any removal of Executive
from or any failure to re-elect Executive to
his office and position described in Section
1) above, except in connection with
promotions to higher office;
(2) the failure by the Company to maintain and
to continue Executive's participation in the
Company 's benefit or compensation plans as
in effect immediately prior to the Change in
Control (including but not limited to bonus
and incentive compensation plans, stock
option, bonus, award and purchase plans,
life insurance, medical, health and
accident, and disability plans);
(3) the taking of any action by the Company
which would adversely affect Executive's
participation in or reduce Executive's
benefits under any of the Company 's benefit
or compensation plans (including but not
limited to bonus and incentive compensation
plans, stock option, bonus, award and
purchase plans, life insurance, medical,
health and accident, and disability plans);
(4) the failure by the Company to obtain the
assumption of this Agreement by any
successor as required under Section 12) c)
below.
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iii) If Executive is terminated without cause or resigns
for Good Reason, the Company shall continue to
provide the compensation and benefits set forth in
Section 3) for the remainder of the Term, except that
medical and health insurance benefits shall only be
provided until the earlier of (1) the end of the Term
and (2) the date on which Executive and his
dependants are fully covered under the medical
insurance plan of a new employer.
b) TERMINATION BY EXECUTIVE. Executive may terminate this
Agreement upon thirty (30) days' prior written notice to the
Company . Executive may at his election and subject to the
Company 's consent, perform his duties through to the
termination date and the Company shall continue to pay and
provide Executive with all of the compensation and benefits
set forth in Section 2) through to the termination date, but
Executive shall not receive any severance allowance.
c) TERMINATION BY COMPANY FOR CAUSE. Notwithstanding anything to
the contrary contained herein and subject to applicable law,
the Company may terminate the Executive's employment with
immediate effect if the Board of Directors shall determine in
good faith that any of the following has occurred: (i) acts or
omissions by the Executive which constitute material
misconduct or a knowing violation of a material written policy
of the Company or any of its subsidiaries (provided Executive
has been provided with a copy of such material written
policy), (ii) the Executive or any affiliated or related
person or entity receiving a benefit in money, property or
services from the Company or any of its subsidiaries or from
another person dealing with the Company or any of its
subsidiaries, in material violation of applicable law or
Company policy, (iii) an act of fraud, conversion,
misappropriation, or embezzlement by the Executive or his
conviction of, or entering a guilty plea or plea of no contest
with respect to, a felony, or the equivalent thereof, (iv) a
material breach by the Executive of any provision of Section 8
hereof, (v) the Executive's failure or refusal (whether
intentional, reckless or negligent) to perform his duties
under this Agreement or (vi) any other breach by the Executive
of this Agreement in any material respect. In no event shall
the Executive's termination by the Company be considered to
have been for cause if such termination took place as a result
of (1) the Executive's bad judgment or negligence or (2) any
act or omission without intent of gaining a profit to which
the Executive was not legally entitled or (3) any act or
omission believed by the Executive in good faith to have been
in, or not opposed to, the interests of the Company . If
Executive is terminated for cause, he shall be entitled to the
compensation and other benefits set forth in Section 2)
through the last date of Executive's employment. Upon payment
of all obligations under this Agreement that are then
outstanding, this Agreement shall terminate. Notice of such
termination shall be given to Executive in writing, specifying
the reasons for such termination.
6) SEVERANCE UPON CHANGE IN CONTROL: As of the effective date of a Change
of Control as defined in the Employment Agreement set forth in EXHIBIT
C hereto, the Company and Executive shall enter into, and shall be
deemed to have entered into, an Employment Agreement substantially
identical to the agreement set forth in EXHIBIT C, unless such
Employment Agreement has been terminated as provided therein.
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7) PROPRIETARY AND CONFIDENTIAL INFORMATION:
a) All information, data, materials, computer code, intellectual
property rights, customer lists, discoveries, inventions or
processes or improvement in procedures or made or discovered
by Executive during the term of this Agreement in connection
with or in any way affecting or relating to the business of
the Company or capable of being used or adapted for use
therein or in connection therewith is and shall forthwith be
deemed to be "CONFIDENTIAL INFORMATION" and shall be disclosed
to the Company and shall belong to and be the absolute
property of the Company .
b) Executive shall, if and when required so to do, whether during
or after the termination of this Agreement, at Employer's
expense apply or join in applying for any patent or trademark
registration or other similar protection in the United States
or in any other part of the world for any such discovery,
invention, process or improvement and shall execute all
instruments and do all things necessary to register the
patent, trademark or other similar protection when obtained
and all right and title to an interest in the same in the
Company absolutely and as sole beneficial owner.
c) Executive shall not at any time either during the term of this
Agreement or any extension thereof or after the termination of
the employment for any reason (i) divulge any Confidential
Information or other affairs or secrets of the Company to any
other company, person or persons without the previous consent
in writing of the Company or (ii) use or attempt to use any
information which Executive may acquire in the course of the
employment in any manner which may injure or cause loss or be
calculated to injure or cause loss to the Company .
d) Upon the termination of this Agreement for any reason,
Executive shall resign without claim for compensation from as
a director (if applicable) of the Company and from all offices
held by Executive in the Company , and in the event of
Executive failing to do so the Company is hereby irrevocably
authorized to appoint some person in Executive's name and on
Executive's behalf to execute any documents and to do all
things required to give effect to the provisions of this
Section.
e) Upon the termination of this Agreement for any reason,
Executive shall deliver to the Company all documents used by
Executive in the course of the Company 's business, including
but without limiting the foregoing, all price lists, mailing
lists, customer, client or supplier lists, sales information,
catalogues, diaries, log books, computer software and computer
data.
f) Should Executive reveal or threaten to reveal any Confidential
Information, the Company shall be entitled to an injunction
restraining the Executive from disclosing same, or from
rendering any services to any entity to whom such information
has been or is threatened to be disclosed. The right to secure
an injunction is not exclusive, and the Company may pursue any
other remedies it has against the Executive for a breach or
threatened breach of this provision, including the recovery of
damages from the Executive.
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8) RESTRICTIVE COVENANT: Executive expressly agrees that it shall not at
any time for one (1) year after the termination of the employment (i)
undertake or carry on or be employed or directly or indirectly be
concerned or interested either as employer, Executive, consultant,
director or shareholder or (ii) for one (1) year after the termination
of the employment attempt in any way whatsoever to obtain customers or
clients of the Company , in either case in or for any enterprise,
person, firm or company, the principal business of which involves (A)
the production or development or the retail or wholesale selling or
distribution of goods and services that are substantially similar to or
in competition with those sold or provided by the Company or (B) the
sale of memberships in member programs the benefits of which include
the sale or provision of such goods or services. Executive further
agrees during and after the termination of the employment for any
reason, whether for Executive's own account or for any other person or
for any firm or company not to solicit, interfere with or endeavor to
entice away from the Company any employee of the Company or any person,
firm or company who at any time during the continuance of the
employment shall have been a customer or client of the Company .
9) INDEMNITY: Executive shall defend, save and hold harmless the Company
from and against any claims, damages, actions, proceedings or other
losses incurred or suffered by the Company arising out of a material
breach by Executive of the confidentiality provisions herein.
10) GOVERNING LAW; JURISDICTION; VENUE. The Agreement will be interpreted,
construed and enforced in all respects in accordance with the laws of
the State of California, without regard to its conflicts of laws
principles. Each party hereby irrevocably consents to the exclusive
jurisdiction of the state and federal courts San Diego County of the
State of California in connection with any action arising under this
Agreement and waives all defenses regarding the inconvenience of such
forum. THE PARTIES IRREVOCABLY WAIVE THEIR RIGHTS TO A TRIAL BY JURY IN
CONNECTION WITH ANY CLAIM, COUNTERCLAIM OR OTHER PROCEEDINGS ARISING
UNDER OR IN CONNECTION WITH THIS AGREEMENT.
11) MISCELLANEOUS.
a) INTEGRATION. This Agreement is the sole contract governing the
relationship between the Company or any predecessor of the
Company and Executive, and supersedes any and all prior
agreements, letters of intent, correspondence, negotiations,
discussions or understandings between the Company or any
predecessor of the Company and the Executive.
b) SEVERABILITY. If any provision of the Agreement is held
invalid by a court with jurisdiction over the parties to the
Agreement, (i) such provision will be deemed to be restated to
reflect as nearly as possible the original intentions of the
parties in accordance with applicable law and (ii) the
remaining terms, provisions, covenants and restrictions of
this Agreement will remain in full force and effect. If this
Agreement is held invalid or cannot be enforced, then to the
full extent permitted by law any prior agreement between the
Company (or any predecessor thereof) and the Executive shall
be deemed reinstated as if this Agreement had not been
executed.
c) SUCCESSORS. The Company 's rights and obligations under this
Agreement will inure to the benefit and be binding upon the
Company 's successors and assignees.
d) AMENDMENTS. This Agreement may be altered only by a written
agreement signed by the party against whom enforcement of any
waiver, change, modification, extension, or discharge is
sought.
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e) NOTICES. Any notice, approval, request, authorization,
direction or other communication under this Agreement will be
given in writing and will be deemed to have been delivered and
given for all purposes (i) on the delivery date if delivered
personally to the party to whom the same is directed; (iii)
one business day after deposit with a commercial overnight
carrier, with written verification of receipt; or (iii) five
business days after the mailing date, whether or not actually
received, if sent by U.S. mail, return receipt requested,
postage and charges prepaid, or any other means of rapid mail
delivery for which a receipt is available. All notices to the
Company will be effective if delivered to THE COMPANY
Corporation, 00000 Xx Xxxxxx Xxxx, Xxxxx 000, Xxx Xxxxx, XX
00000, attention: President, or such other address specified
by the Company in writing. All notices to Executive will be
effective if delivered to Executive's last residential address
provided to the Company by Executive.
f) ASSIGNMENTS. The Company will not assign this Agreement or any
right, interest or benefit under this Agreement without the
prior written consent of Executive.
g) REMEDIES. Except where otherwise specified herein, the rights
and remedies granted to a party under the Agreement are
cumulative and in addition to, and not in lieu of, any other
rights or remedies which the Party may possess at law or in
equity.
h) LIMITED EFFECT OF WAIVER BY COMPANY. Should Company waive
breach of any provision of this Agreement by the Executive,
such waiver will not operate or be construed as a waiver of
further breach by the Executive.
i) COUNTERPARTS. The Agreement may be executed in counterparts,
each of which will be deemed an original and all of which
together will constitute one and the same document.
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IN WITNESS WHEREOF, parties have signed this Employment Agreement as of the date
first above written.
GENIUS PRODUCTS, INC.
By: /S/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
Chief Executive Officer
EXECUTIVE
By: /S/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
