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EXHIBIT 10.8
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated this the 10th day of August, 1998, among
CARMIKE CINEMAS, INC., a Delaware corporation (the "Company"), and XXXX X.
XXXXXXX, 0000 Xxxxx Xxxx, Xxxxxxxx, XX 00000 (the "Executive"), sometimes
hereinafter referred to collectively as the "Parties".
W I T N E S S E T H :
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter set forth, the parties hereto covenant and
agree as follows:
1. EMPLOYMENT: As a senior executive officer (a) the Company agrees to
employ the Executive, and the Executive agrees to work for the Company for a
period (hereinafter called the "Employment Period") commencing on the date of
this Agreement and ending at the expiration of five (5) years from said date,
provided, however, that on December 31 of each year hereof, the term hereof
shall be extended for one (1) year providing that neither the Company nor the
Executive shall have given written notice to the other during the thirty (30)
days prior to such anniversary date of its or his wish not to so extend this
Agreement. (b) The Executive shall during the Employment Period have the duties
as are customarily performed by Chief Executive Officers of Company.
2. COMPENSATION: (a) Company will continue to pay Executive during the
Employment Period a basic minimum gross compensation of $290,492.40 per year.
Salary shall be payable semi-monthly in arrears, and shall be subject to such
payroll and withholding deductions as are required by law. (b) The Executive
will during the term of the Employment Period be entitled to participate in the
Welfare Benefit Plans. (c) The Executive will during the term of the Employment
Period be entitled to participate in the Executive Bonus Plan and the Incentive
Stock Option Plan. (d) The base salary stated in 2 (a) above shall be increased
to reflect increases in the cost of living on the following basis: The salary
shall be increased in the same proportion as the Urban Wage and Clerical
Employees for All U.S. Cities Index shall increase as reported by the U. S.
Department of Labor. The base period shall be the data published for the month
of December 1996. In January of each year (during the term hereof, beginning in
1998) the ratio of the amount reported for the proceeding December and for the
base period shall be computed. For the fiscal year beginning with January 1998,
the base salary to be paid that year shall be an amount in the same proportion
to the base salary as the preceding December index bears to the index for
December 1996.
3. INSURANCE-DEATH BENEFIT. (a) If the Executive dies during the term
of the Employment Period, the Company shall pay to the surviving spouse of the
Executive, or to such other person as the Executive may designate in writing
the sum of
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one (1) year's salary, which payment shall be made monthly for twelve (12)
months following the date of his death. (b) The Executive understands that the
Company has purchased Key Man insurance on the life of the Executive, of which
Company shall be the designated beneficiary. Accordingly, Executive herewith
agrees to submit to such physical examination as may be required by any
insurance company to bind the amount of insurance the Company wishes to
purchase on Executive's life.
4. TRAVEL AND ENTERTAINMENT EXPENSE ALLOWANCES. (a) In addition to the
compensation to be paid to the Executive, the Company shall, during the
Employment Period, reimburse the Executive for all reasonable and necessary
expenses actually incurred by him in performance of his duties. In addition,
the Company during the Employment Period shall reimburse the Executive
consistent with past practice of the Company with respect to paying or
reimbursing the Executive for certain items. (b) Company shall during the
Employment Period provide Executive with a car and driver for use by Executive
in the performance of his duties.
5. EMPLOYMENT PERIOD. (a) The "Employment Period" shall commence on
the date set forth above; provided, however, that should the Executive's
employment by the Company be earlier terminated as hereinafter set forth in
this section, the Employment Period shall end on the date of such earlier
termination. (b) The Employment Period shall be terminated; (i) upon the death
of the Executive; (ii) in the event that because of any physical or mental
disability, the Executive is unable to perform, does not perform for a
continuous period of six (6) months his duties as an Executive Officer, by
written notice therefor; (iii) by the Company for cause, by delivery to the
Executive of a written notice specifying such termination and the reasons
therefor. During the period after notice is given and before termination of
employment becomes effective, the Executive shall continue to be a regular
employee of the Company, and shall be entitled to receive his salary and
prerequisite to the extent of his participation prior to the giving of such
notice. (c) For the purpose of this Section 5, "cause" shall mean willful
malfeasance.
6. CHANGE IN CONTROL.
(a) In General: In the event there is a Change in Control (as
defined in this paragraph) of Company, this Agreement shall, in order to help to
eliminate the uncertainties and concerns which may arise at such time, be
automatically extended for a period of three (3) years, beginning on the first
day of the month during which such Change in Control shall occur, upon all the
same terms and provisions contained herein.
(b) Definition: A "Change in Control" shall be deemed to have
occurred upon the happening of any one of the following circumstances:
(1) A change in stock ownership which would be required to be
reported as a "Change in Control" pursuant to the Securities Act of 1934, as
Amended, or any similar Federal or State reporting requirement;
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(2) Any person, group (as used in Section 13 (d) (3) of the
Securities Act of 1934) or organization becomes the beneficial owner, directly
or indirectly, of 20% or more of the combined voting power of Company's
outstanding stock;
(3) The individuals constituting the existing Board of
Directors cease, at any time during the term of this Agreement or any
extensions hereof, to constitute at least a majority of the Board;
(4) The stockholders of Company have approved a merger or
sale of all or substantially all of the assets of Company;
(5) Company combines with another Company and is the
surviving company, but, immediately after the combination, the shareholders of
Company immediately prior to the combination hold, directly or indirectly, less
than 50% of the voting control of the combined company.
(c) No Requirement to Seek Employment and No Offset: Company
agrees that if Executive's employment is terminated by Company during the term
of this Agreement, following a Change in Control, Executive is not required to
seek other employment or attempt in any way to reduce the amounts payable to
Executive by Company pursuant to the applicable terms of this Agreement or
extensions hereof; it being understood and agreed that the amount of any
payment or benefit to Executive provided for hereunder shall not be reduced by
any compensation earned by Executive as a result of his employment by another
employer, by any retirement benefits or by Company's attempt to offset any
amount claimed to be owed by Executive to Company or otherwise.
(d) Executive's Termination for "Good Reason": If following a
Change in Control, Executive terminates his employment hereunder for "Good
Reason", as hereinafter defined, Executive shall be entitled to all of the
compensation and benefits provided for under this Agreement, or any extension
hereof, as if Company had terminated Executive "without cause". Termination by
Executive for "Good Reason" shall mean the occurrence of any one or more of the
following events:
(1) Any breach by Company of the terms and conditions of
this Agreement, or any extensions hereof, effecting Executive's salary and bonus
compensation, employee benefits, stock options or the loss of any of Executive's
titles or positions with Company;
(2) A significant diminution of Executive's duties and
responsibilities;
(3) The assignment to Executive of any duties
inconsistent with his duties and responsibilities existing at the time of a
Change in Control;
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(4) Any purported termination of Executive's
employment by Company other than as permitted by
this Agreement;
(5) The relocation of Company's principal office or
Executive's own office to any place outside an area which is within 25 miles of
the current principal office of Company in Columbus, Georgia;
(6) The failure of any successor to Company to
expressly assume and agree to discharge Company's obligations to Executive
under this Agreement, or any extensions hereof, in form and substance
satisfactory to Executive.
7. COVENANT NOT TO COMPETE; TRADE SECRETS. (a) Executive agrees that
he will during the period set forth herein, and for a period of two (2) years
thereafter, not accept employment with, or participate, directly or indirectly,
as owner, stockholder, director, officer, manager, consultant or agent, or
otherwise use his special, unique or extraordinary skills or knowledge with
respect to the Company's business in or with any business, firm, corporation,
partnership, association, venture or other entity or person which is engaged in
the business of ownership and management of motion picture theatres, except
this shall not be construed to prohibit Executive from owning an insubstantial
fraction of the securities of a corporation which is publicly traded on a
securities exchange or over the counter. (b) Trade Secrets: Executive further
agrees that he will not, at any time during the period described in (a) above,
or thereafter, disclose to any party other than the Company any trade secrets
or other Confidential Information, learned or obtained by him while he is a
stockholder, officer or director of the Company. As used herein, the term
"Confidential Information" means information disclosed to the Executive or
known by him as a consequence of or through his employment by the Company and
not generally known in the industry to which the Company is engaged, and which
in any way relates to the Company's products, processes, services, inventions
(whether patentable or not), formulas, techniques or know how, including, but
not limited to, information relating to research, development, manufacturing,
purchasing, accounting, engineering, marketing, merchandising and selling. In
the event of a breach or threatened breach by the Executive of the provisions
of this Section 6, the parties agree that the Company's remedies at law would
be inadequate, and the Company shall be entitled to an injunction to enforce
such provisions.
8. ASSIGNMENT. The rights and obligations of the Executive and the
Company under this Employment Agreement shall inure to the benefit of the
parties, and shall be binding upon the Company and upon the successors and
assigns of the Company. The Executive may not assign his rights or obligations
hereunder.
9. NOTICES. All notices and requests hereunder shall be in writing and
shall be delivered in person, or by certified mail, return receipt requested,
postage prepaid, to the Company with a copy to Xxxxxxx X. Xxxxxxx, P. O. Xxx
000, Xxxxxxxx, XX 00000-0000, and if to the Executive, addressed to him at 0000
Xxxxx Xxxx, Xxxxxxxx, XX 00000.
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Such notices and requests shall be deemed delivered on the date on
which personally delivered, or if delivered by certified mail, return receipt
requested, the date sent. Either party may change his or its address for
receipt of notices and requests hereunder by notice duly given to the other
party in accordance with the provisions of this Section.
10. GOVERNING LAW. The laws of the State of Georgia shall govern all
questions relative to the interpretation and construction of this Employment
Agreement, and to the performance hereof.
11. SEVERABILITY. In case any one or more of the provisions or part(s)
of a provision contained in this Employment Agreement shall for any reason be
held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision or part(s)
of a provision of this Employment Agreement, but this Employment Agreement
shall be reformed and construed as if such invalid, illegal or unenforceable
provision or part(s) of a provision had never been contained herein, and such
provision or part(s) reformed so that it would be valid, legal and enforceable
to the maximum extent permitted.
12. WAIVER. No waiver by either party of any default hereunder, or by
the other shall in any way prejudice the waiving party with respect to any
subsequent default hereunder (whether or not similar) by the other party.
13. HEADINGS OF NO EFFECT. The headings and captions hereof have been
inserted solely for convenience of reference, and shall in no way define, limit
or describe any of the provisions of this Employment Agreement.
14. ENTIRE AGREEMENT. This instrument contains the entire Agreement of
the parties, it may not be changed orally, but only by an instrument in
writing, signed by the party against whom enforcement of any waiver, change,
modification, extension or discharge is sought.
15. ARBITRATION. The exclusive procedure for resolution of any dispute
under this Agreement shall be by arbitration in Atlanta, GA before one
arbitrator, in accordance with the rules then existing of the American
Arbitration Association. The award of the arbitrator shall be final and binding
upon the parties, and judgment upon the award may be entered in any court
having jurisdiction thereof. The cost of arbitration, if any, shall be divided
equally between the parties. Each party shall otherwise bear its or his own
expense.
16. This Employment Agreement supersedes any previous employment
agreement, and same are null and void, and of no legal effect whatsoever.
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IN WITNESS WHEREOF, the parties hereto have set their hands as of the
date first above written.
COMPANY:
CARMIKE CINEMAS, INC.
BY:/s/ Xxxx X. Xxxxxxx, III
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Authorized Signature
EXECUTIVE:
/s/ Xxxx X. Xxxxxxx
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XXXX X. XXXXXXX
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