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EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT (together with all schedules hereto, the
"Agreement"), made in New York, New York as of the 15th day of October, 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 Xxxxxxx X. Xxxxx, the undersigned individual ("Executive").
WHEREAS, simultaneous with the execution and delivery hereof, the
parties hereto, among others, are consummating the transactions contemplated by
an Amended and Restated Agreement and Plan of Reorganization, dated as of
September 12, 1997 (the "Acquisition Agreement"), pursuant to which the Company
agreed to acquire by merger all of the outstanding capital stock of SingleTrac
Entertainment Technologies, Inc. ("SingleTrac");
NOW, THEREFORE, IN CONSIDERATION 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 the date of this Agreement and ending on the third anniversary of
the date of this Agreement (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 Company and
shall serve in such other and/or additional position(s) as the Company may
determine from time to time.
(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. Until
otherwise determined by the Chief Executive Officer or the Chief Operating
Officer of the Company, Executive shall have the title and responsibilities, and
shall report to the person, set forth on Schedule A hereto.
(c) Place of Performance. During the Agreement Term, Executive
shall be based at the Company's offices at the location set forth on Schedule A
hereto or at such other location(s) as the Company may determine 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. Executive hereby acknowledges that he shall have the commuting
arrangement set forth on Schedule A (if applicable), and that Executive's duties
shall otherwise require additional reasonable business travel from time to
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time.
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 set forth
on Schedule A hereto during the Agreement Term, payable in installments
consistent with the Company's normal payroll practices.
(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, except the SingleTrac Bonus Pool (as defined below) which may be
amended only with the consent of the senior management of the SingleTrac Studio
(as defined in the Acquisition Agreement). In addition to the compensation
provided for in this Agreement, Executive may be awarded bonuses and stock
options as determined by the Board of Directors in its sole discretion.
(c) Travel, Business and Relocation 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. If applicable, Executive shall also be entitled
to reimbursement of relocation expenses duly incurred by Executive as set forth
on Schedule A hereto, provided, that in the event that Executive's employment is
terminated by reason of his retirement or voluntary resignation other than for
Good Reason (as defined in Section 5(d) below) prior to one year from the date
hereof, Executive shall promptly repay two-thirds of such reimbursed expenses,
plus the monthly prorated portion of the remaining one-third of such reimbursed
expenses.
(d) Grant of Option and Terms Thereof. Within five days of the
date of this Agreement, Executive shall be granted an option (the "Option"),
pursuant to the Company's 1995 Stock Incentive Plan or 1997 Stock Incentive
Plan, to purchase the number of shares (the "Option Shares") of the Company's
common stock, par value $0.01 per share ("Common Stock"), set forth on Schedule
A hereto. The exercise price for each Option Share shall be equal to the closing
sale price of the Common Stock, as reported on the Nasdaq National Market, on
the last trading date immediately preceding the grant date of the Option. The
terms (including exercisability) of the Option shall be governed by the
Company's 1995 Stock Incentive Plan or 1997 Stock Incentive Plan, as the case
may be, as well as the applicable option agreement entered into pursuant to the
terms of such applicable plan. The Compensation Committee of the Board of
Directors of the Company has approved such grant. The Option constitutes the
entire grant of options allocated to Executive under Section 2.1(e) of the
Acquisition Agreement.
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(e) Participation in SingleTrac Bonus Pool. Subject to the
terms and conditions of the Acquisition Agreement and of this Agreement,
Executive shall be entitled to participate, to the extent allocated to
Executive, in the retention-oriented bonus pool established for employees of
SingleTrac (the "SingleTrac Bonus Pool") pursuant to the Acquisition Agreement.
Pursuant to the SingleTrac Bonus Pool, Executive is eligible to receive bonus
payments as set forth on Attachment 1 of Schedule A.
(f) 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; provided, however, payments made pursuant to the SingleTrac
Bonus Pool shall be made in accordance with the terms of the SingleTrac Bonus
Pool. Such payment shall be subject to all applicable employment and withholding
taxes.
(g) 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,
substantially full-time or part-time (except as such part-time employment is
approved in advance in writing by the Chief Executive Officer or the Board of
Directors of the Company) 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, 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 (as defined below) 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 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
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Section 5(d).
For purposes hereof, the term "Competing Business" shall include (i)
any business or venture which (A) develops, designs, produces, creates, writes
or programs, whether for original use or Conversion (as defined below), or (B)
manufactures, publishes, licenses, sells, distributes or supplies, any Covered
Software (as defined below) (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, as
work-for-hire, or otherwise; and (ii) any other business which is substantially
similar to the whole or any significant part of the business conducted by the
Company.
As used herein, the term "Covered Software" shall mean video game
software or other interactive entertainment software (or any part thereof,
including without limitation, any engines or development tools used therein or
therefor) for any hardware platform, including without limitation, personal
computers and dedicated game consoles (such as, for example and without
limitation, Sony PlayStation, Nintendo 64 and Sega Saturn, and their respective
successor or future generation platforms). As used herein, the term "Conversion"
shall mean any conversion or porting of any software (or any portion thereof)
for use on a different hardware platform or in a different language.
(c) No Solicitation of Employment. For a period of two years
following the termination of Executive's employment with the Company, Executive
shall not solicit or encourage any other employee to leave the Company for any
reason, nor assist a Competing Business or any other business in doing so.
Without limiting the foregoing, Executive shall not employ an employee of the
Company in any business in which Executive owns 15% or more of the stock or
other securities of such business or in which Executive has the power to
control, or direct the management of, such business.
(d) Company Contacts. Executive shall not, during the period
of Executive's employment with the Company and for a period of eighteen months
thereafter, except as required by the Company in the performance by Executive of
his duties under this Agreement, directly or indirectly, contact or solicit any
customer, supplier, licensor, or licensee (in each case including without
limitation, publishers, developers, producers, designers and programmers) of the
Company, or any such customer, supplier, licensor or licensee solicited by the
Company, with whom Executive had come into contact, or whose account Executive
had serviced or worked on, in connection with Executive's employment with the
Company during the twelve month period immediately preceding the termination of
such employment (collectively, "Company Contacts"), for the purpose of (i)
buying, selling or licensing, or granting rights in, any Covered Software or
related intellectual property to or from such person, or (ii) providing or
obtaining any development, designing, production, creation, writing, programming
or consulting services relating to any Covered Software to or from such person
(collectively, "Specified Purpose"). In addition, no business in which Executive
owns 15% or more of the stock or other securities or in which Executive has the
power to control, or direct the management of, such business shall, directly or
indirectly, enter into discussions with, regardless of who initiates such
discussion, or do any business with any Company Contacts for any Specified
Purpose.
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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 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 other than for Good Reason. 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 other
than for Good Reason (as defined in Section 5(d) below), then the Company shall
pay to Executive, consistent with the Company's normal payroll practices, 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) engaging in
any act which, in each case, subjects, or if generally known would subject, the
Company to public ridicule or embarrassment; (iv) gross neglect or misconduct in
the performance of Executive's duties hereunder; (v) willful or repeated failure
or refusal to perform such duties as may be delegated to Executive commensurate
with Executive's position; or (vi) breach of any provision of this Agreement by
Executive.
(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 one hundred twenty (120) days within
any three hundred sixty-five (365) day period, 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, consistent with the Company's normal payroll
practices, 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.
(d) Termination By Company For Any Other Reason; Voluntary
Resignation for Good Reason. In the event that Executive's employment hereunder
is terminated by the Company during the Agreement Term for any reason other than
as provided
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in Sections 5(b) or 5(c) hereof, or by reason of Executive's voluntary
resignation for Good Reason (as defined below), then the Company shall pay to
Executive, consistent with the Company's normal payroll practices, the Base
Salary through such date of termination and, in lieu of any further compensation
and benefits (except the Bonus Pool Payment (as defined below) which will be
paid in accordance with the SingleTrac Bonus Pool and the provisions of Section
5(e) hereof) for the balance of the Agreement Term, severance pay equal to the
Base Salary that Executive would have otherwise received during the period (the
"Severance Period") beginning on such date of termination and ending on the
earlier of (i) the one-year anniversary of the effective date of such
termination or (ii) the last day of the Agreement Term, 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. Under such circumstances, except
as set forth below, for the balance of the Severance Period, Executive shall
also continue to participate in and receive the benefits and perquisites
provided for in Sections 3(b) and 3(c) hereof (excluding any bonus and stock
options under Section 3(b)) 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 or make such
salary, severance, benefits and perquisites shall cease and Executive's rights
thereto shall immediately terminate and shall be forfeited.
For the purposes of this Agreement, "Good Reason" shall mean
(i) a material diminution in Executive's responsibilities, as described on
Schedule A hereto, (ii) a reduction in the Base Salary exceeding ten percent
(10%) of the amount set forth on Schedule A hereto, or an elimination of all
benefit plans and programs, benefits and perquisites referred to in Section
3(b), or (iii) a substantial change in the commuting arrangement set forth on
Schedule A hereto (if applicable); provided, that in each case Executive shall
have provided a written notice of any event described in clauses (i), (ii) or
(iii) of this sentence to the Company in accordance with Section 8(n) at least
thirty (30) days prior to the date of his resignation for Good Reason, and such
event is not cured by the Company within thirty (30) days of such notice.
(e) Bonus Pool Participation. In the event that Executive's
employment hereunder is terminated under the provisions of Section 5(d), or by
reason of Executive's death or Disability, so long as Executive is otherwise
eligible to receive an award of his allocated share of the SingleTrac Bonus Pool
(the "Bonus Pool Payment"), Executive (or, in case of his death, his devisee,
legatee, other designee or his estate, as the case may be) shall receive the
Bonus Pool Payment to the same extent as if Executive's employment had not been
terminated. In the event that Executive's employment hereunder is terminated by
the Company for Cause or by reason of Executive's retirement or voluntary
resignation other than for Good Reason, Executive shall not be entitled to
receive the Bonus Pool Payment except any portion thereof which became payable
pursuant to the terms of the SingleTrac Bonus Pool prior to the date of such
termination. Notwithstanding anything contained in this Agreement or the
Acquisition Agreement, in the event that Executive shall breach Section 4 or 6
hereof, in addition to any other remedies the Company may have, the Company's
obligation pursuant to this Section 5(e) and the Acquisition Agreement to make
the Bonus Pool Payment to Executive shall cease and Executive's rights thereto
shall immediately terminate and shall be
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forfeited.
(f) No Further Liability; Release. Payment made and
performance by the Company in accordance with Section 5(d) 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 accordance with this Section 5(d) (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 payment of any severance under Section 5(d) shall be
conditioned 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.
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.
(b) Protection of Confidential Information. Executive
acknowledges
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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 or 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. Without limiting the foregoing, such
prior written approval shall not be required with respect to lectures or
teachings by Executive at colleges or universities, provided, however, that
Executive shall not disclose any Confidential Information during such lectures
or teachings.
(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) Noncompetition Agreement. Nothing in this Agreement shall
in any event limit the duration and enforceability of the Noncompetition
Agreement, of even date herewith, between the Executive and the Company which
has been entered into separately and as a condition to the Company's entry into
the Acquisition Agreement.
(b) 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.
(c) 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.
(d) Cooperation. Following termination of employment with the
Company, Executive shall cooperate with the Company, as requested by the
Company, to effect a transition of Executive's responsibilities and to ensure
that the Company is aware of all matters being handled by Executive.
(e) 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.
(f) Protection of Reputation. During the Agreement Term and
thereafter, Executive agrees that he will not take any action which is intended,
or would reasonably be expected, to harm the Company or its reputation or which
would reasonably be expected to lead to unwanted or unfavorable publicity to the
Company.
(g) 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 Xxx Xxxx, Xxx Xxxx xx Xxxx Xxxx
Xxxx, Xxxx. The parties hereto expressly consent to the jurisdiction of such
court in New York, New York or Salt Lake City, Utah in which either of such
parties commences an action or proceeding 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(n) 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: Secretary, which
agent may be changed by the Company upon thirty (30) days' prior written notice
to Executive).
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(h) Entire Agreement. This Agreement (including the Exhibit
hereto) together with the Acquisition Agreement and the agreements entered into
in connection therewith 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 agreements, if any, between the
Company and Executive, which agreement(s) hereby are terminated and shall be of
no further force or effect.
(i) 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.
(j) 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.
(k) 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 (including
SingleTrac) 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.
(l) 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.
(m) 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
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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 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 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.
(n) 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.
(o) Assistance in Proceedings, Etc. Executive shall, without
additional compensation (other than a reimbursement of documented, reasonable,
out-of-pocket expenses), 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.
(p) 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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(q) Company Policies. Executive shall comply with all standard
policies of the Company, including, without limitation, such policies relating
to restrictions on sale of the Company's securities while in possession of
material inside information or outside of "window" periods (and, if Executive is
deemed an "affiliate" of the Company under applicable SEC rules and
interpretations, during periods which could adversely affect any "pooling of
interests" transaction to which the Company is a party).
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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/ Xxxxxxx X. Xxxxx
--------------------------- ---------------------------
Name: Xxxxxx Xxxxxxxxxx Xxxxxxx X. Xxxxx
Title: President
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SCHEDULE A
NAME OF EXECUTIVE: XXXX XXXXX
TITLE: SENIOR VICE-PRESIDENT
LOCATION: SALT LAKE CITY
It is the intent of both parties that executive continue to reside in the Salt
Lake City area while commuting as necessary to fulfill responsibilities in the
San Francisco offices of the Company. The parties further acknowledge that the
responsibilities and demands of the executive's position may lead to a decision
by the executive to relocate to the San Francisco area. Executive's decision to
relocate to the San Francisco area may be contingent on the Company providing an
acceptable relocation reimbursement/compensation package. In addition, if a
decision to relocate to San Francisco is made by executive, the Company will
make a cost of living adjustment to executive's salary. The amount of cost of
living adjustment shall be determined following good faith discussions between
the executive and the Company.
COMMUTING ARRANGEMENT:
In addition to the travel requirements associated with carrying out the
responsibilities of the position, executive is expected to commute on a regular
basis between Salt Lake City and San Francisco. The Company shall reimburse
reasonable expenses incurred by executive while commuting, including but not
limited to air fare, auto rental, lodging and meals. Should executive
demonstrate the cost effectiveness of doing so, the Company agrees to reimburse
employee for lease of an automobile in lieu of renting, and for rent of an
apartment, in lieu of hotel. In the event that executive's family travels to the
San Francisco area in lieu of executive's travel to Salt Lake City, the Company
shall reimburse the reasonable expenses incurred by executive's family, not to
exceed the typical commuting expenses then being experienced by executive.
BASE SALARY: $185,000
BONUS:
The executive shall receive bonus per Company policies as is appropriate for
executives of similar title and responsibilities. In addition, the executive
shall participate in the SingleTrac Bonus Plan.
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REIMBURSEMENT OF RELOCATION EXPENSES:
Not applicable unless executive decides to relocate to San Frandsco as
contemplated above. Should executive decide to relocate to the San Francisco
area, the Company shall provide relocation benefits and expense reimbursement to
be negotiated.
GT OPTION SHARES TO BE GRANTED: 35,000
REPORTING TO: Xxxxxxx Xxxxx
RESPONSIBILITIES:
|_| oversee all product development, both internal and external to the
Company;
|_| ongoing management of products, development cycles, development contract
negotiations and evaluations of product submissions;
|_| direct and coordinate project management staff and development personnel;
or, the reasonable equivalent of the above responsibilities.
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