1
EXHIBIT 10.94
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), made as of January 1,
1997, is entered into by West Coast Entertainment Corporation, a Delaware
corporation with its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (the "Company"), and ▇▇▇▇ ▇▇▇▇▇ (the "Employee").
The Company desires to employ the Employee, and the Employee desires to
be employed by the Company. In consideration of the mutual covenants and
promises contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the parties hereto,
the parties agree as follows:
1. Term of Employment. The Company hereby agrees to employ the
Employee, and the Employee hereby accepts employment with the Company, upon the
terms set forth in this Agreement, for the period commencing on January 1, 1997
(the "Commencement Date") and ending four (4) years from the date hereof, unless
sooner terminated in accordance with the provisions of Section 4 (the
"Employment Period").
2. Title; Capacity. The Employee shall serve as Executive Vice
President or in such other position as the Company or its Board of Directors
(the "Board") may determine from time to time. The Employee shall be subject to
the supervision of,
2
and shall have such authority as is delegated to him by, the Board or such
officer of the Company as may be designated by the Board.
The Employee hereby accepts such employment and agrees to undertake the
duties and responsibilities inherent in such position and such other duties and
responsibilities as the Board or its designee shall from time to time reasonably
assign to him, including without limitation the duties and responsibilities set
forth on Attachment A hereto, which duties and responsibilities may be revised
from time to time by the Board or its designee. The Employee agrees to devote
his entire business time, attention and energies to the business and interests
of the Company during the Employment Period. The Employee agrees to abide by the
rules, regulations, instructions, personnel practices and policies of the
Company and any changes therein which may be adopted from time to time by the
Company.
3. Compensation and Benefits.
3.1 Salary. The Company shall pay the Employee an annual base
salary of $150,000 for the one-year period commencing on the Commencement Date.
Upon an annual review, such salary shall be subject to increase thereafter as
determined by the Board.
3.2 Fringe Benefits. The Employee shall be entitled to
participate in all bonus and benefit programs that the Company establishes and
makes available to its employees, if any, to the extent that Employee's
position, tenure, salary, age, health and other qualifications make him eligible
to participate. The Employee shall
2
3
be entitled to three (3) weeks paid vacation per year, to be taken at such times
as may be approved by the Board or its designee.
3.3 Reimbursement of Expenses. The Company shall reimburse the
Employee for all reasonable travel, entertainment and other expenses incurred or
paid by the Employee in connection with, or related to, the performance of his
duties, responsibilities or services under this Agreement, in accordance with
policies adopted by the Company from time to time.
3.4 Moving Expenses. The Company shall reimburse the Employee
for reasonable moving and travel expenses up to a total of $5,200 upon
submission of invoices.
3.5 Stock Options. On the Commencement Date, the Company shall
grant to Employee an option to purchase up to 40,000 shares of Common Stock of
the Company at an exercise price equal to the closing price of a share of Common
Stock of the Company on the date of grant. Subject to the terms of the option
grant, the option will become exercisable in four equal annual installments
beginning on the first anniversary of the Commencement Date.
3.6 Automobile Allowance. During the Employment Period, the
Company will reimburse the Employee for automobile lease and maintenance
payments in an amount not to exceed $600 per month.
4. Employment Termination. The employment of the Employee by the
Company pursuant to this Agreement shall terminate upon the occurrence of any of
the following:
3
4
4.1 After the expiration of the Employment Period, at the
election of the Company for any reason upon not less than 45 days' prior written
notice;
4.2 At the election of the Company, for cause, immediately
upon written notice by the Company to the Employee. For purposes of this Section
4.2, cause for termination shall be deemed to exist upon (a) a good faith
finding by the Board of Directors of failure of the Employee to perform his
assigned duties for the Company, dishonesty, gross negligence or willful
misconduct, or (b) the conviction of the Employee of, or the entry of a pleading
of guilty or nolo contendere by the Employee to, any crime involving moral
turpitude or any felony;
4.3 Thirty days after the death or disability of the Employee.
As used in this Agreement, the term "disability" shall mean the inability of the
Employee, due to a physical or mental disability, for a period of 90 days,
whether or not consecutive, during any 360-day period to perform the services
contemplated under this Agreement. A determination of disability shall be made
by a physician satisfactory to both the Employee and the Company, provided that
if the Employee and the Company do not agree on a physician, the Employee and
the Company shall each select a physician and these two together shall select a
third physician, whose determination as to disability shall be binding on all
parties;
4.4 At the election of the employee, upon not less than 45
days' prior written notice of termination.
5. Effect of Termination.
4
5
5.1 Termination for Cause or at Election of Either Party. In
the event the Employee's employment is terminated for cause pursuant to Section
4.2, or at the election of either party pursuant to Section 4.1 or 4.4, as
applicable, the Company shall pay to the Employee the compensation and benefits
otherwise payable to him under Section 3 through the last day of his actual
employment by the Company.
5.2 Termination for Death or Disability. If the Employee's
employment is terminated by death or because of disability pursuant to Section
4.3, the Company shall pay to the estate of the Employee or to the Employee, as
the case may be, the compensation which would otherwise be payable to the
Employee up to the end of the month in which the termination of his employment
because of death or disability occurs.
5.3 Survival. The provisions of Sections 6 and 7 shall survive
the termination of this Agreement.
6. Non-Compete.
(a) During the Employment Period and for a period of three (3)
years after the termination or expiration thereof, the Employee will not
directly or indirectly:
(i) as an individual proprietor, partner,
stockholder, officer, employee, director, joint venturer, investor, lender, or
in any other capacity whatsoever (other than as the holder of not more than two
percent (2%) of the total outstanding stock of a publicly held company), engage
in the business of marketing or selling (at the retail level) any videotape,
game, movie and electronic
5
6
entertainment products of the kind or type developed or being developed,
produced, marketed, rented or sold by the Company while the Employee was
employed by the Company; or
(ii) recruit, solicit or induce, or attempt to
induce, any employee or employees of the Company to terminate their employment
with, or otherwise cease their relationship with, the Company; or
(iii) solicit, divert or take away, or attempt to
divert or to take away, the business or patronage of any of the clients,
customers or accounts, or prospective clients, customers or accounts, of the
Company which were contacted, solicited or served by the Employee while employed
by the Company.
(b) If any restriction set forth in this Section 6 is found by
any court of competent jurisdiction to be unenforceable because it extends for
too long a period of time or over too great a range of activities or in too
broad a geographic area, it shall be interpreted to extend only over the maximum
period of time, range of activities or geographic area as to which it may be
enforceable.
(c) The restrictions contained in this Section 6 are necessary
for the protection of the business and goodwill of the Company and are
considered by the Employee to be reasonable for such purpose. The Employee
agrees that any breach of this Section 6 will cause the Company substantial and
irrevocable damage and therefore, in the event of any such breach, in addition
to such other remedies which may be available, the Company shall have the right
to seek specific performance and injunctive relief.
6
7
7. Proprietary Information and Developments.
7.1 Proprietary Information.
(a) Employee agrees that all information and know-how, whether
or not in writing, of a private, secret or confidential nature concerning the
Company's business or financial affairs (collectively, "Proprietary
Information") is and shall be the exclusive property of the Company. By way of
illustration, but not limitation, Proprietary Information may include
inventions, products, processes, methods, techniques, formulas, compositions,
projects, developments, plans, research data, financial data, personnel data,
computer programs, and customer and supplier lists. Employee will not disclose
any Proprietary Information to others outside the Company or use the same for
any unauthorized purposes without written approval by an officer of the Company,
either during or after his employment, unless and until such Proprietary
Information has become public knowledge without fault by the Employee.
(b) Employee agrees that all files, letters, memoranda,
reports, records, data, drawings, program listings, or other written,
photographic, electronic or other tangible material containing Proprietary
Information, whether created by the Employee or others, which shall come into
his custody or possession, shall be and are the exclusive property of the
Company to be used by the Employee only in the performance of his duties for the
Company.
7
8
(c) Employee agrees that his obligation not to disclose or use
information, know-how and records of the types set forth in paragraphs (a) and
(b) above, also extends to such types of information, know-how, records and
tangible property of customers of the Company or suppliers to the Company or
other third parties who may have disclosed or entrusted the same to the Company
or to the Employee in the course of the Company's business.
7.2 Developments.
(a) Employee will make full and prompt disclosure to the
Company of all inventions, improvements, discoveries, methods, developments,
software, and works of authorship, whether patentable or not, which are created,
made, conceived or reduced to practice by the Employee or under his direction or
jointly with others during his employment by the Company, whether or not during
normal working hours or on the premises of the Company (all of which are
collectively referred to in this Agreement as "Developments").
(b) Employee agrees to assign and does hereby assign to the
Company (or any person or entity designated by the Company) all his right, title
and interest in and to all Developments and all related patents, patent
applications, copyrights and copyright applications. However, this Section 7(b)
shall not apply to Developments which do not relate to the present or planned
business or research and development of the Company and which are made and
conceived by the Employee not during normal working hours, not on the Company's
premises and not using the Company's tools, devices, equipment or Proprietary
Information.
8
9
(c) Employee agrees to cooperate fully with the Company, both
during and after his employment with the Company, with respect to the
procurement, maintenance and enforcement of copyrights and patents (both in the
United States and foreign countries) relating to Developments. Employee shall
sign all papers, including, without limitation, copyright applications, patent
applications, declarations, oaths, formal assignments, assignment of priority
rights, and powers of attorney, which the Company may deem necessary or
desirable in order to protect its rights and interests in any Development.
7.3 Other Agreements. Employee hereby represents that he is
not bound by the terms of any agreement with any previous employer or other
party to refrain from using or disclosing any trade secret or confidential or
proprietary information in the course of his employment with the Company or to
refrain from competing, directly or indirectly, with the business of such
previous employer or any other party. Employee further represents that his
performance of all the terms of this Agreement and as an employee of the Company
does not and will not breach any agreement to keep in confidence proprietary
information, knowledge or data acquired by him in confidence or in trust prior
to his employment with the Company.
8. Notices. All notices required or permitted under this Agreement
shall be in writing and shall be deemed effective upon personal delivery or upon
deposit in the United States Post Office, by registered or certified mail,
postage prepaid, addressed to the other party at the address shown above, or at
such other address or
9
10
addresses as either party shall designate to the other in accordance with this
Section 8.
9. Pronouns. Whenever the context may require, any pronouns used in
this Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular forms of nouns and pronouns shall include the plural,
and vice versa.
10. Entire Agreement. This Agreement constitutes the entire agreement
between the parties and supersedes all prior agreements and understandings,
whether written or oral, relating to the subject matter of this Agreement.
11. Amendment. This Agreement may be amended or modified only by a
written instrument executed by both the Company and the Employee.
12. Governing Law. This Agreement shall be construed, interpreted and
enforced in accordance with the laws of the State of Delaware.
13. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of both parties and their respective successors and
assigns, including any corporation with which or into which the Company may be
merged or which may succeed to its assets or business, provided, however, that
the obligations of the Employee are personal and shall not be assigned by him.
14. Miscellaneous.
14.1 No delay or omission by the Company in exercising any
right under this Agreement shall operate as a waiver of that or any other right.
A waiver or consent given by the Company on any one occasion shall be effective
only in that
10
11
instance and shall not be construed as a bar or waiver of any right on any other
occasion.
14.2 The captions of the sections of this Agreement are for
convenience of reference only and in no way define, limit or affect the scope or
substance of any section of this Agreement.
14.3 In case any provision of this Agreement shall be invalid,
illegal or otherwise unenforceable, the validity, legality and enforceability of
the remaining provisions shall in no way be affected or impaired thereby.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year set forth above.
WEST COAST ENTERTAINMENT
CORPORATION
By: /s/ T. ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
Title:President and CEO
EMPLOYEE
/s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------
▇▇▇▇ ▇▇▇▇▇
11
12
Exhibit A
Team Leader - Help build team spirit at every level of WCEC. Evaluate team
spirit in all employees and report as necessary to ▇▇▇▇▇/▇▇▇▇.
Purchasing/Movie Management - Work with ▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇ to
develop a philosophy of interaction with studios, helping to reconcile WCEC's
goals regarding Co-op/MDF with our needs to carry the best product at the proper
amounts. Oversee Ken's implementation of this philosophy. Help Movie Management
personnel devise monthly purchasing strategies under Ken's supervision. Make
certain ▇▇▇▇▇▇▇▇ is actively managing sell-thru inventory.
Monitor WCEC buyer's qualitative tastes in their product niche, ability of WCEC
buyers to identify hot, new, product lines at the earliest stages of
introduction before our competition finds them and report your impressions to
▇▇▇▇.
Distribution - Determine (with ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇) proper configuration for all WCEC distribution (e.g. - internal or
external DC for part or all of purchased product) including cost analysis and
pricing/terms analysis and studio direct analysis detailing all costs and
anticipated savings.
Operations - Implement "Movie Buff's Movie Store" policies to the retail stores.
Devise implementation plan - including personnel, action plan, time horizon -
for approval, using Kyle's existing notes/ideas as the basis and utilizing Movie
Buff Committee input.
Studio Relations - Think about and suggest (perhaps in committee) new ways of
interacting with the studios and/or new WCEC advertising dollar pass-through
mechanisms. Help WCEC studio team interface at highest studio levels to build
corporate image. Help WCEC structure international distribution configurations
and gain knowledge of international and domestic target markets through studio
personnel.
Acquisitions - When asked, help WCEC acquisition team explain the new Company
philosophies and goals to acquisition targets, constantly identify to ▇▇▇▇▇/▇▇▇▇
any potential acquisition targets you think WCEC should consider.
12
