EXHIBIT 10.9
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") between Lions Gate
Entertainment Inc. ("Lions Gate" or "Company") and Xxxxxxx Xxxxx ("Employee") is
entered into and is effective as of April 1, 2002 with respect to the following:
1. EMPLOYMENT: Lions Gate hereby agrees to employ Employee as its
Vice Chairman and Employee hereby agrees to accept such employment under the
terms and conditions set forth below.
2. TITLE: Vice Chairman.
3. TERM: One (1) year: April 1, 2002 to March 31, 2003
4. OPTION: Intentionally Deleted
5. BASE SALARY: Employee's compensation for the Term shall be
$300,000 per annum, subject to normal statutory deductions, payable semi-monthly
or in accordance with Lions Gate's then existing payment policy. Employee.
6. BONUSES: Discretionary by the CEO of the Company with the
following understanding: Employee's target bonus shall be $150,000 ("Target
Bonus") based upon his performance in the following areas: (i) production of
motion pictures; (ii) securing financing for the production of motion pictures;
(iii) matters pertaining to investment banking, mergers and acquisitions as such
pertain to Lions Gate, and (iv) financial analysts' coverage of Lions Gate.
Lions Gate shall advance Employee $50,000 against the Target Bonus upon
execution hereof.
7. BENEFITS: Employee shall be eligible for all employee benefits
(health insurance and vacation) and 401 (k) per Lions Gate's standard benefit
program for an employee employed by Lion Gate at Employee's level, commencing
immediately. Employee shall be entitled to accrue vacation at the rate of three
weeks per year up to a maximum of three weeks at any given time. Vacation shall
accrue as of the first day of employment hereunder. Employee shall be entitled
to a car allowance in the amount of $1,111 per month.
8. SERVICES: 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. The foregoing notwithstanding, Lions
Gate acknowledges that Employee is a shareholder of Ignite Entertainment and the
parties agree to negotiate at arms length any matters concerning Lions Gate and
Ignite.
9. CONFIDENTIAL INFORMATION; RESULTS AND PROCEEDS: Employee
hereby expressly agrees that Employee will not disclose any confidential matters
of Lions gate prior to, during or after Employee's employment. In addition,
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 and are within the scope of Employee's employment
and responsibilities hereunder. Employee agrees that during the Term, Lions Gate
shall own all other results and proceeds of Employee's services that are related
to Employee's employment and responsibilities hereunder.
10. STOCK OPTIONS: Lions Gate shall request that the Compensation
Committee of Lions Gate ("CCLG") authorize and grant Employee the right (the
"Option") to purchase 75,000 common shares of Company (priced at US$2.55 per
share) in accordance with the terms and conditions of the existing Employee
Stock Option Plan ("ESOP") except that the vesting schedule shall be as follows:
(i) 25,000 upon execution hereof
(ii) 25,000 on April 1, 2003
(iii) 25,000 on April 1, 2004
In the event that (a) Lions Gate does not renew Employee's contract;
and (b) Lions Gate terminates Employee without cause, then all stock option
granted hereunder shall be deemed to have vested as of the date of the
termination.
Employee acknowledges that this grant of stock is subject to the
approval of the CCLG. In the event that a "Change of Control" causes Xxx
Xxxxxxxxxx'x stock options that are issued under the ESOP to accelerate in
vesting, Employee's stock options issued hereunder shall accelerate in vesting
on a similar basis. "Change of Control" shall be defined in accordance with the
"change of control" definition set for forth in Xxx Xxxxxxxxxx'x employment
agreement with Lions Gate.
11. NOTICES: All notices to be given pursuant to this agreement
shall be effected either by mail or personal delivery in writing as follows:
Lions Gate:
Lions Gate Entertainment
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx xxx Xxx, Xxxxxxxxxx 00000
Attention: General Counsel
Employee:
Xxxxxxx Xxxxx
c/o Lions Gate Entertainment
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx xxx Xxx, Xxxxxxxxxx 00000
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12. COMPLETE AGREEMENT; MODIFICATIONS: Each party to this
agreement acknowledges that no representations, inducements, promises, or
agreements, orally or otherwise, have been made by any party, or anyone acting
on behalf of any party, which are not embodied herein, and that no other
agreement, statement, or promise not contained in this agreement shall be valid
or binding. This agreement embodies the complete agreement and understanding
between the parties and supersedes all prior understandings, agreements or
representations by or between the parties, written or oral, which may have
related to the subject matter hereof. Any modification of this agreement will be
effective only if it is in writing and signed by the party to be charged.
13. LAWS: This agreement will be governed by the internal laws of
the State of California irrespective of rules pertaining to conflicts of laws.
This Agreement may be executed via facsimile and/or in counter-parts and all
such counter-parts and/or facsimile copies shall be deemed one and the same and
an original of this Agreement.
14. WAIVERS: Failure to require compliance with any provision or
condition provided for under this agreement at any one time, or several times,
shall not be deemed a waiver or relinquishment of such provision or condition at
any other time.
15. ASSIGNMENT: Employee shall not assign any of his rights or
delegate any of his duties under this agreement.
16. TERMINATION AND NON - RENEWAL: 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
(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 his 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; or 4) any act of misconduct by Employee having a substantial
adverse affect on the business or reputation of Lions Gate.
(e) Without Cause. In such case Employee shall be
entitled to receive either (i) the Base Salary in paragraph 5 through the
conclusion of the Term, subject to Employee's obligation to mitigate in
accordance with California Law; or (ii) a severance amount equal to 50% of the
balance of the compensation still owing to Employee under paragraph 5 hereof at
the time of termination shall be paid to Employee by Lions Gate in one lump sum,
which payment shall relieve Lions Gate of any and all obligations to Employee.
Employee shall elect either
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alternative (i) or (ii) within 10 days of termination without cause in writing.
In the event that Employee fails to so elect within such time period, then Lions
Gate shall have the right to elect either alternative (i) or (ii).
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 Lions Gate shall pay to
Employee, only such compensation as is earned under Paragraph 5 as of the date
of termination, as well as any accrued vacation benefits which remain unused
through the date of termination.
In the event of the completion of a "Change of Control" during the
Term, Employee shall be entitled to a severance payment of $300,000 following
the completion of the Change of Control in lieu of any other payments to which
Employee may be entitled to receive hereunder. "Change of Control" shall be
defined in accordance with the "change of control" definition set forth in Xxx
Xxxxxxxxxx'x employment agreement with Lions Gate.
17. TRADE SECRETS: The parties acknowledge and agree that during
the term of this Agreement and in the course of the discharge of his duties
hereunder, Employee shall have access to and become acquainted with 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 that this information constitutes Lions Gate's trade secrets.
Employee agrees that he shall not intentionally or through gross negligence
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 his employment for Lions
Gate.
18. ARBITRATION: Employee and Lions Gate agree that any and all
claims or controversies whatsoever brought by Employee or Lions Gate, arising
out of or relating to this Agreement, his employment with Lions Gate, or
otherwise arising between Employee and Lions Gate, will be settled by final and
binding arbitration under the Federal Arbitration Act in accordance with the
Employment Dispute Resolution Rules of the American Arbitration Association.
This includes all claims whether arising in tort or contract and whether arising
under statute or common law. Such claims may include, but are not limited to,
those relating to this Agreement, wrongful termination, retaliation, harassment,
or any statutory claims under Title VII of the Civil Rights Act of 1964, the
Civil Rights Act of 1991, the Fair Employment and Housing Act, the Age
Discrimination in Employment Act, the Americans with Disabilities Act, or
similar Federal or state statutes. In addition, any claims arising out of the
public policy of California (and/or claims arising out of the public policy of
the state in which Employee is employed), any claims of wrongful termination,
employment discrimination, retaliation, or harassment of any kind, as well as
any claim related to the termination or non-renewal of this Agreement shall be
arbitrated under the terms of this Agreement. The obligation to arbitrate such
claims will survive the termination of this Agreement. The Company shall pay the
administrative costs of such arbitration proceeding,
The arbitration will be conducted before an arbitrator who is a member
of the National Academy of Arbitrators and selected by the parties from the
American Arbitration Association's
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Labor Panel. The arbitrator shall have a business office in or be a resident of
Los Angeles County, California. The arbitrator will have jurisdiction to
determine the arbitrability of any claim. The arbitrator will not have the right
to add to, subtract from or modify any of the terms of this Agreement, nor the
power to reverse or modify any decision reserved to Lions Gate's discretion. The
arbitrator shall have the authority to grant all monetary or equitable relief
(including, without limitation, injunctive relief and ancillary costs and fees)
available under state and Federal law. Judgment on any award rendered by the
arbitrator may be entered and enforced by any court having jurisdiction thereof.
Discovery shall be in accordance with the California Arbitration Act.
If the foregoing represents Employee's and Lions Gate's understanding
and agreement and Employee Lions Gate agree to be legally bound by the foregoing
terms and conditions, each so indicate in the place provided for below.
Lions Gate Entertainment, Inc.
By: __________________________________
Its: _________________________________
Agreed to and Accepted:
________________________________
Xxxxxxx Xxxxx
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