February 21, 2006 Mr. James Keegan 2840 Bayshore Ave Ventura, CA 93001 Re.: Employment Agreement Dear Mr. Keegan:
EXHIBIT 10.11
February 21, 2006
Mr. Xxxxx Xxxxxx
0000 Xxxxxxxx Xxx
Xxxxxxx, XX 00000
0000 Xxxxxxxx Xxx
Xxxxxxx, XX 00000
Re.: Employment Agreement
Dear Xx. Xxxxxx:
On behalf of Lions Gate Films Inc. (“Company”), this is to confirm the terms of your
employment by the Company. We refer to you herein as “Employee”. The terms of Employee’s
employment from this date forward are as follows:
1. The term of this agreement (“Agreement”) will begin April 16, 2006 and end
April 15, 2008 (“Term”). During the Term of this Agreement Employee will serve as
Chief Financial Officer. Employee shall render such services as are customarily rendered
by persons in Employee’s capacity in the motion picture industry and as may be
reasonably requested by Company.
The Company may, at its sole discretion, extend the Term of this Agreement for an additional
year, commencing April 16, 2008 and ending April 15, 2009 (“Option Year”) by giving notice to
Employee of its election to extend this Agreement at least ninety (90) days before that date.
So long as this Agreement shall continue in effect, Employee shall devote Employee’s full
business time, energy and ability exclusively to the business, affairs and interests of the Company
and matters related thereto, shall use Employee’s best efforts and abilities to promote the
Company’s interests and shall perform the services contemplated by this Agreement in accordance
with policies established by the Company.
2. The following compensation will be paid to Employee during the Term of this
Agreement:
Base Salary. During the Term of this Agreement, the Company agrees to pay Employee a
base salary as follows:
April 16, 2006 through April 15, 2007 — the rate of Four Hundred Thousand dollars
($400,000.00) per year (“Base Salary — Year 1”), payable in accordance with the
Company’s normal payroll practices in effect.
Mr. Xxxxx Xxxxxx
February 21, 2006
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February 21, 2006
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April 16, 2007 through April 15, 2008 — the rate of Four Hundred Twenty Five
Thousand dollars ($425,000.00) per year (“Base Salary — Year 2”), payable in
accordance with the Company’s normal payroll practices in effect.
In the event that this Agreement is extended for a third year at the Company’s
option (April 16, 2008 through April 15, 2009) in accordance with Section 1 above,
Employee’s compensation shall be at the rate of Four Hundred Fifty Thousand dollars
($450,000.00) per year (“Base Salary-Option Year”), payable in accordance with the
Company’s normal payroll practices in effect.
Nothing in this Agreement shall limit the Company’s right to modify its payroll practices, as
it deems necessary.
Finally, Employee shall be entitled to receive performance bonuses at the full discretion of
the CEO of the Company and the approval of the Board of the Company.
3. As an employee of the Company, Employee will continue to be eligible to
participate in all benefit plans to the same extent as other salaried employees subject to
the terms of such plans.
4. Employee shall be entitled to take paid time off without a reduction in salary,
subject to (i) the approval of Employee’s supervisor, and (ii) the demands and
requirements of Employee’s duties and responsibilities under the Agreement. There are
no paid vacation days. Finally, Employee will be eligible to be reimbursed for any
business expenses in accordance with the Company’s current Travel and Entertainment
policy.
5. Lions Gate shall request that the Compensation Committee of Lions Gate
(“CCLG”) authorize and grant Employee 25,000 common shares (“Grants”) of Lions
Gate Entertainment Corp. in accordance with the terms and conditions of the existing
and/or future Employee Stock Plan (collectively, the “Plan”). Employee acknowledges
that this Grant of stock is subject to (i) the approval of the CCLG; and (ii) Lions Gate
Entertainment Corp’s Shareholders (“Shareholders”) approving an increase to the number
of options and shares available under the Plan. The next scheduled meeting of the
Shareholders shall be in September, 2006. The award date (“Award Date”) shall be the
date of the board meeting when the Grant is approved. The Grant shall vest as follows:
1/3 on the 1st anniversary of the
Award Date;
2/3 on the 2nd anniversary of the Award Date;
3/3 on the 3rd anniversary of the Award Date.
2/3 on the 2nd anniversary of the Award Date;
3/3 on the 3rd anniversary of the Award Date.
Mr. Xxxxx Xxxxxx
February 21, 2006
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February 21, 2006
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If the Grants described herein are not approved by the CCLG or Shareholders do not approve
additional options and shares under the plan, Employee shall receive the cash equivalent (“Cash
Equivalent”). The Cash Equivalent shall be the value of the shares on the date such shares (or a
portion thereof) would have vested, and shall be paid on such date.
In the event of Employee’s death the shares granted, if any, in this Section 5 shall be
deemed fully vested.
In the event the Company does not elect to extend this Agreement to April 15, 2009 (Option
Year) per paragraph 2 of Section 1, the Grants should be deemed fully vested at the end of Year 2.
6. Employee agrees that the Company Employee Handbook outlines other
policies, which will apply to Employee’s employment, and Employee acknowledges
receipt of such handbook. Please note, however, that the Company retains the right to
revise, modify or delete any policy or benefit plan it deems appropriate.
7. This Agreement shall terminate upon the happening of any one or more of the
following events:
(a) The mutual written agreement between Lions Gate and
Employee; or
Employee; or
(b) The death of Employee; or
(c) Employee’s having become so physically or mentally disabled as to be
incapable, even with a reasonable accommodation, of satisfactorily performing Employee’s
duties hereunder for a period of ninety (90) days or more, provided that Employee has not
cured disability within ten days of written notice; or
(d) The determination on the part of Lions Gate that “cause” exists for termination of
this Agreement; “cause” being defined as any of the following: 1) Employee’s conviction of a felony
or plea of nolo contendere to a felony except in connection with a traffic violation; 2)
commission, by act or omission, of any material act of dishonesty in the performance of Employee’s
duties hereunder; 3) material breach of this Agreement by Employee; 4) any act of misconduct by
Employee having a substantial adverse effect on the business or reputation of Lions Gate.
(e) Without Cause. In such case Employee shall be entitled to
receive the Base Salary set forth in Section 2 through the conclusion of Year 2 or Option Year if
the option has been exercised subject to Employee’s obligation to mitigate in accordance with
California Law. In the alternative, at Lions Gate’s discretion, if Employee is terminated by Lions
Gate for any reason other than as set forth in sub-paragraphs 7(a)-(d), a severance amount equal to
50% of the balance of the compensation still owing to Employee under Section 2 hereof at the time
of termination, but not less
Mr. Xxxxx Xxxxxx
February 21, 2006
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February 21, 2006
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than six (6) months’ salary, shall be paid to Employee by Lions Gate, which payment shall relieve
Lions Gate of any and all obligations to Employee. In the event this Agreement is terminated by the
Company Without Cause, the cost of maintaining Employee’s health, dental, and vision insurance
coverage under COBRA shall be reimbursed to Employee by Company until the earlier of six (6) months
following the date of termination or the date Employee secures new employment and is eligible for
health care benefits.
In the event that this Agreement is terminated pursuant to sub-paragraphs (a)-(d) above
neither Lions Gate nor Employee shall have any remaining duties or obligations hereunder, except
that (i) Lions Gate shall pay to Employee, only such compensation as is earned under Section 2 as
of the date of termination and (ii) Employee shall continue to be bound by Sections 9, 11, and 12.
For the sake of clarity, in all events Sections 9, 11, and 12 shall survive and be binding upon
Employee post termination.
8. Employee’s services shall be exclusive to Lions Gate during the Term.
Employee shall render such services as are customarily rendered by persons in
Employee’s capacity in the motion picture industry and as may be reasonably requested
by Lions Gate. Employee hereby agrees to comply with all reasonable requirements,
directions and requests, and with all reasonable rules and regulations made by Lions Gate
in connection with the regular conduct of its business; to render services during
Employee’s employment hereunder whenever and wherever and as often as Lions Gate
may reasonably require in a competent, conscientious and professional manner, and as
instructed by Lions Gate in all matters, including those involving artistic taste and
judgment, but there shall be no obligation on Lions Gate to cause or allow Employee to
render any services, or to include all or any of Employee’s work or services in any
motion picture or other property or production.
9. Employee agrees that Lions Gate shall own all rights of every kind and
character throughout the universe, in perpetuity to any material and/or idea suggested or
submitted by Employee or suggested or submitted to Employee by a third party that
occurs during the Term or any other period of employment with the Company, its parent,
affiliates, or subsidiaries that are within the scope of Employee’s employment and
responsibilities hereunder. Employee agrees that during the Term and any other period of
employment with the Company, its parent, affiliates, or subsidiaries, Lions Gate shall
own all other results and proceeds of Employee’s services that are related to Employee’s
employment and responsibilities. Employee shall promptly and fully disclose all
intellectual property generated by the Employee during the Term and any other period of
employment with the Company, its parent, affiliates, or subsidiaries in connection with
Employee’s employment hereunder. All copyrightable works that Employee creates in
connection with Employee’s obligations under this Agreement and any other period of
employment with the Company, its parent, affiliates, or subsidiaries shall be considered
“work made for hire” and therefore the property of the Company. To the extent any work
so produced or other intellectual property so generated by Employee is not deemed to be
a “work made for hire,” Employee hereby assigns and agrees to assign to the Company
Mr. Xxxxx Xxxxxx
February 21, 2006
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February 21, 2006
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(or as otherwise directed by the Company) Employee’s full right, title and interest in and to all
such works and other intellectual property. Employee agrees to execute any and all applications for
domestic and foreign copyrights or other proprietary rights and to do such other acts (including
without limitation the execution and delivery of instruments of further assurance or confirmation)
requested by the Company to assign the intellectual property to the Company and to permit the
Company to enforce any copyrights or other proprietary rights to the intellectual property.
Employee will not charge the Company for time spent in complying with these obligations. This
Section 9 shall apply only to that intellectual property which related at the time of conception to
the Company’s then current or anticipated business or resulted from work performed by Employee for
the Company. Employee hereby acknowledges receipt of written notice from the Company pursuant to
California Labor Code Section 2872 that this Agreement (to the extent it requires an assignment or
offer to assign rights to any invention of Executive) does not apply fully to an invention which
qualifies fully under California Labor Code Section 2870.
10. Employee shall not assign any of Employee’s rights or delegate any of
Employee’s duties under this Agreement.
11. The parties acknowledge and agree that during the Term of this Agreement
and in the course of the discharge of Employee’s duties hereunder and at any other period
of employment with the Company, its parent, affiliates, or subsidiaries, Employee shall
have and has had access to information concerning the operation of Lions Gate and its
affiliated entities, including without limitation, financial, personnel, sales, planning and
other information that is owned by Lions Gate and regularly used in the operation of
Lions Gate’s business and (to the extent that such confidential information is not
subsequently disclosed) that this information constitutes Lions Gate’s trade secrets.
Employee agrees that Employee shall not disclose any such trade secrets, directly or
indirectly, to any other person or use them in any way, either during the Term of this
Agreement or at any other time thereafter, except as is required in the course of
Employee’s employment for Lions Gate. Employee shall not use any such trade secrets in
connection with any other employment and/or business opportunities following the Term.
In addition, Employee hereby expressly agrees that Employee will not disclose any
confidential matters of Lions Gate that are not trade secrets prior to, during or after
Employee’s employment including the specifics of this Agreement. . Employee shall not
use any such confidential information in connection with any other employment and/or
business opportunities following the Term. In addition, in order to protect the
Confidential Information, Employee agrees that during the Term and for a period of two
(2) years thereafter, Employee will not, directly or indirectly, induce or entice any other
executive of the Company to leave such employment or cause anyone else to leave such
employment.
12. Any dispute, controversy or claim arising out of or in respect to this
Agreement (or its validity, interpretation or enforcement), the employment relationship or
the subject matter hereof shall at the request of either party be submitted to and settled by
Mr. Xxxxx Xxxxxx
February 21, 2006
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February 21, 2006
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binding arbitration conducted before a single arbitrator in Los Angeles in accordance with the
Federal Arbitration Act, to the extent that such rules do not conflict with any provisions of this
Agreement. Said arbitration shall be under the jurisdiction of Judicial Arbitration and
Mediation Services, Inc. (“JAMS”) in Los Angeles, California. All such actions must be instituted
within one year after the controversy or claim arose or forever be waived. Failure to institute an
arbitration proceeding within such period shall constitute an absolute bar to the institution of
any proceedings respecting such controversy or claim, and a waiver thereof. The arbitrator shall
have the authority to award damages and remedies in accordance with applicable law. Any award,
order of judgment pursuant to such arbitration shall be deemed final and binding and may be entered
and enforced in any state or federal court of competent jurisdiction. Each party agrees to submit
to the jurisdiction of any such court for purposes of the enforcement of any such award, order of
judgment. Company shall pay for the administrative costs of such hearing and proceeding.
13. This Agreement expresses the binding and entire Agreement between Employee and the Company
and shall replace and supersede all prior arrangements and representations, either oral or written,
as to the subject matter hereof. All modifications or amendments to the Agreement must be in
writing, signed by both parties.
Please acknowledge your confirmation of the above terms by signing below where indicated
and returning this letter to me.
Xxx, please call Xxxxx Xxxxxxx at (000) 000-0000 if you have any questions.
Very truly yours,
LIONS GATE FILMS INC.
| /s/ Xxxxx Xxxxx
|
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| EVP and General Counsel | ||||
| AGREED AND ACCEPTED | ||||
| This 4 day of April, 2006 | ||||
| /s/ Xxxxx Xxxxxx
|
