Exhibit 10.6
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "AGREEMENT"), dated as of February 10,
2006 (the "EFFECTIVE DATE"), is entered into by and between Marc Laurence
Greenberg, an individual residing at 4211 Roma Court, Marina del Rey, California
90292 ("EXECUTIVE"), and MRG Entertainment, Inc., a California corporation,
located at 301 Arizona Avenue, Santa Monica, California 90401 ("COMPANY").
WHEREAS, Executive possesses valuable knowledge and skills which are
relevant to the operation of Company's business; and
WHEREAS, Company desires to provide for the employment of Executive,
and Executive is willing to serve as an executive of Company, on the terms and
conditions herein provided; and
WHEREAS, New Frontier Media, Inc., a Colorado corporation ("NEW
FRONTIER"), Marc Lawrence Greenberg Trust dated May 11, 2001 ("GREENBERG
TRUST"), Goldberg Family Trust dated June 15, 2001 ("GOLDBERG TRUST"), Richard
Bruce Goldberg ("GOLDBERG") and Executive are parties to that certain Stock
Purchase Agreement dated February 6, 2006 (the "PURCHASE AGREEMENT"); and
WHEREAS, the Greenberg Trust and the Goldberg Trust collectively own
one hundred percent (100%) of the issued and outstanding common stock shares of
Company and Lifestyles Entertainment, Inc., a California corporation
(collectively, the "BUSINESSES"); and
WHEREAS, New Frontier is acquiring all of the stock and the goodwill of
the Businesses, which will continue to be engaged in (i) the entertainment,
production, marketing and distribution businesses, and (ii) producing, licensing
and selling motion pictures and television programs; and
WHEREAS, pursuant to the Purchase Agreement, the Businesses shall
become wholly owned subsidiaries of New Frontier; and
WHEREAS, Executive is a beneficiary of the Greenberg Trust and the
Co-President and Secretary of each of the Businesses and is benefiting
financially from the acquisition contemplated by the Purchase Agreement; and
WHEREAS, Executive has had and will continue to have access to and
possession of various trade secrets and other proprietary and confidential
information of the Businesses which is material to the continued value of the
Businesses; and
WHEREAS, the entering into this Agreement by Company and Executive is a
condition to the consummation of the closing contemplated by the Purchase
Agreement and a material inducement of New Frontier to enter into the Purchase
Agreement; and
WHEREAS, Company desires to hire Executive, and Executive wishes to
accept such employment, upon the terms and conditions set forth in this
Agreement.
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NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained, Company and Executive agree as follows:
1. EMPLOYMENT PERIOD. Executive shall be employed by Company, in
accordance with the terms and provisions of this Agreement, commencing on the
Effective Date and ending at midnight on February 9, 2009, unless sooner
terminated in accordance with the provisions of Sections 3 or 4 herein (the
"EMPLOYMENT PERIOD").
2. TERMS OF EMPLOYMENT.
A. POSITION AND DUTIES. During the Employment Period, Executive
shall be employed by Company as President or a Co-President (to the extent that
Goldberg remains employed by Company as Co-President), and Executive accepts and
agrees to such employment. During the Employment Period, Executive shall perform
all services and acts necessary and advisable to fulfill the duties and
responsibilities as are commensurate and consistent with Executive's position
and shall render such services on the terms set forth herein. During the
Employment Period, Executive shall report to the Chief Executive Officer (the
"CEO") of New Frontier (or the CEO's designee, so long as such designee is of
equal or greater rank than the CEO). Executive shall have such powers and duties
with respect to his position as Co-President as may reasonably be assigned to
Executive by the CEO, to the extent consistent with Executive's position and
status. Executive agrees to devote his full-time attention to the business and
affairs of Company. During the Employment Period, it shall not be a violation of
this Agreement for Executive to: (a) serve on corporate, civic, charitable, and
professional association boards or committees; (b) deliver lectures or fulfill
speaking engagements; and (c) manage personal investments, so long as such
activities do not result in more than de minimus interference with the
performance of Executive's responsibilities as Co-President of Company in
accordance with this Agreement or do not create any perceived or actual conflict
of interest with Company or New Frontier. The CEO reserves the right for
legitimate business reasons to require Executive to end or refrain from
participating in any such activities upon reasonable prior written notice to
Executive. Executive's employment with Company under this Agreement shall be
Executive's exclusive employment during the Employment Period.
B. COMPENSATION.
(i) Base Salary. During the Employment Period, Executive shall
receive a base salary ("BASE SALARY"), which shall be paid in equal installments
on a bi-weekly basis, at the rate of Three Hundred Fifty Thousand Dollars
($350,000) per annum, less standard state and federal tax-related deductions and
withholdings.
(ii) Discretionary Bonus. In addition to Executive's Base
Salary, the Compensation Committee of the Board of Directors of New Frontier
(the "NEW FRONTIER BOARD") may, in its sole discretion, award cash bonuses
annually to Executive, if at all, in an aggregate amount of up to one hundred
percent (100%) of Executive's Base Salary, less standard state and federal
tax-related deductions and withholdings. Notwithstanding the foregoing,
Executive shall have the right, to be determined in his sole discretion, to
decline and waive any discretionary bonus amount approved by the New Frontier
Board and, in such event, such approved bonus amount shall not count against the
calculation of EBITDA under the Earnout Agreement entered into as of even date
herewith by and among New Frontier, Executive, Goldberg, the Greenberg Trust and
the Goldberg Trust (the "EARNOUT AGREEMENT"), provided that Executive notifies
the CEO in writing of such waiver by the later of (i) September 30th of the year
during which such bonus is accrued, or (ii) within ten (10) business days after
Executive is advised in writing of the accrued bonus amount. For purposes of
this Agreement, the term "EBITDA" shall have the meaning ascribed to it in the
Earnout Agreement.
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(iii) Expenses. During the Employment Period, Company shall
reimburse Executive for all reasonable employment-related expenses incurred by
Executive in accordance with the policies, practices and procedures of Company
as in effect generally from time to time after the Effective Date.
(iv) Vacation and Sick Leave. Executive acknowledges that
Company has no policy concerning vacation time or sick leave applicable to its
executive level employees and, by executing this Agreement, Executive
acknowledges and agrees that he shall not accrue any such vacation or sick leave
benefits during the Employment Period. Executive is authorized to take paid time
off provided he meets his professional and productivity obligations to Company
as determined by the CEO. Executive is to coordinate time off with the CEO.
(v) Car Allowance. During the Employment Period, Executive shall
be entitled to a car allowance equal to Eight Hundred Fifty Dollars ($850) per
month (the "CAR ALLOWANCE"), to be paid in accordance with and subject to
Company's car allowance policy. The Car Allowance shall be paid bi-weekly, and
shall be taxable to Executive whether or not Executive has an actual car payment
(including any car lease payment).
(vi) Savings and Retirement Plans. During the Employment Period,
Executive shall be entitled to participate in all savings and retirement plans
maintained by New Frontier, including any 401(k) plan, on the same terms as
executives of New Frontier or other subsidiaries of New Frontier of similar rank
to Executive are entitled to participate.
(vii) Key Man Insurance. During the Employment Period, Company
may at its election obtain and maintain in full force and effect term life
insurance in such amounts as Company may elect in its sole discretion on the
life of Executive naming Company or New Frontier as beneficiary (the "KEY MAN
INSURANCE"). Executive shall cooperate with Company and New Frontier with
respect to any reasonable underwriting activities as may be required by New
Frontier's insurer(s) in connection with obtaining the Key Man Insurance,
including, without limitation, undertaking such medical examinations and
providing such documents and information as New Frontier or its insurer(s) may
reasonably request.
(viii) Welfare Benefit Plans. During the Employment Period,
Executive shall be eligible to participate in all welfare benefit plans made
available by New Frontier to other executives of similar rank to Executive;
provided, however, nothing in this Section 2(B)(viii) shall operate to reduce or
impair New Frontier's right to alter, amend, or cancel any such plans, programs
or benefits at any time, upon reasonable advance notice to Executive.
(ix) Stock Options. Executive shall be eligible to participate
in such Stock Option Plans of New Frontier that may be made available from time
to time to New Frontier executives of similar rank to Executive; provided,
however, the level, terms and conditions of such participation shall be
determined by and within the sole discretion of the New Frontier Board.
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(x) Withholdings. All payments made to Executive hereunder shall
be subject to all applicable state and federal tax-related withholding
obligations, as required by applicable law.
3. EARLY TERMINATION OF EMPLOYMENT.
Executive and Company each acknowledge that either party has the
right to terminate Executive's employment with Company at any time for any
lawful reason whatsoever, with or without Cause (as defined herein) or advance
notice, pursuant to the following:
A. FOR CAUSE. Company may terminate Executive's employment during
the Employment Period for Cause. For purposes of this Agreement, "CAUSE" shall
mean (i) the conviction of Executive for committing an act of fraud,
embezzlement, theft or other act constituting a crime or the guilty or nolo
contendere plea of Executive to any such crime; (ii) fraudulent conduct or an
act of dishonesty or breach of trust on the part of Executive in connection with
the business of Company or any of its affiliates or subsidiaries; (iii)
violation of any Company policy of which Executive is aware and is given a
period of ten (10) days' prior written notice and opportunity to cure during
such period; (iv) failure, neglect, or refusal by Executive to engage in
diligent efforts to properly discharge, perform or observe any or all of
Executive's job duties for any reason other than Company's material breach of
this Agreement or Executive's Permanent Disability (as defined herein), which
failure, neglect, or refusal continues after Company provides ten (10) days'
prior written notice to Executive; provided, however, Company shall not be
required to deliver any such notice under this subpart (iv) on more than one (1)
occasion for each year of the Employment Period; (v) breach of the
Non-Competition, Non-Solicitation and Trade Secret Agreement attached as Exhibit
J to the Purchase Agreement (the "NON-COMPETITION AGREEMENT"); (vi) any uncured
breach of the Employee Proprietary Information and Inventions Agreement which
results in damage to the Company, attached as Exhibit A to this Agreement (the
"PROPRIETARY INFORMATION AGREEMENT"); and (vii) any other breach or failure by
Executive to comply with any of the provisions of this Agreement applicable to
him and which is not remedied within ten (10) days after written notice thereof
from Company. The parties acknowledge that this definition of "CAUSE" is not
intended and does not apply to any aspect of the relationship between Company
and any of its employees, including Executive, beyond determining Executive's
eligibility for the Without Cause Severance Payments (as defined herein).
B. WITHOUT CAUSE. Company may terminate Executive's employment
without Cause by providing Executive ten (10) business days advance notice of
such termination.
C. UPON EXECUTIVE'S DEATH OR PERMANENT DISABILITY. Subject to
applicable state or federal law, Executive's employment shall terminate
automatically upon Executive's death or upon Executive's permanent disability
("PERMANENTLY DISABLED" or "PERMANENT DISABILITY"), meaning that Executive is
unable to perform the essential functions of his job, with or without reasonable
accommodation, for a total of ninety (90) days out of any six (6) month period.
4. TERMINATION BY EXECUTIVE FOR GOOD REASON. Executive may terminate
his employment with Company for Good Reason. For purposes of this Agreement,
"GOOD REASON" shall mean, in the absence of the advance written consent of
Executive, a reasonable determination by Executive that any of the following has
occurred:
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A. The assignment to Executive of any duties inconsistent in any
material respect with Executive's position (including titles and reporting
requirements, authority, duties or responsibilities as contemplated by Section
2(A) of this Agreement), or any other action by Company which results in a
material diminution in such position, authority, duties or responsibilities,
excluding for this purpose an isolated and insubstantial action not taken in bad
faith and which is remedied by Company within ten (10) days after receipt of
written notice thereof given by Executive; or
B. Any failure by Company to comply with any of the provisions of
this Agreement applicable to it, other than any isolated and insubstantial
failure not occurring in bad faith and which is remedied within ten (10) days
after receipt of written notice thereof given by Executive.
C. Company's failure to obtain a written agreement from any
successor of Company to assume and perform Company's obligations under this
Agreement.
Upon the occurrence of any of the events described in Sections 4(A),
4(B), or 4(C) above, Executive shall be deemed to have waived any right to
receive post termination benefits if he does not notify Company of his intention
to resign within ninety (90) days after the occurrence of such event.
5. OBLIGATIONS OF COMPANY UPON EARLY TERMINATION.
A. TERMINATION FOR CAUSE. In the event Executive is terminated by
Company for Cause, Company's obligation to make payments hereunder shall cease
as of the Date of Termination, as defined in Section 6, except Company shall pay
to Executive, on the Date of Termination, any accrued Base Salary and bonuses
that have been earned through the Date of Termination (the sum of these amounts
shall hereinafter be referred to as the "ACCRUED OBLIGATIONS"). Business
expenses reimbursable under Company policy will be paid within thirty (30) days
after the final submittal of outstanding business expenses, provided that
Executive submit any outstanding business expenses within thirty (30) days after
the Date of Termination. Vesting of any stock option under any applicable Stock
Option Plan shall cease vesting as of the Date of Termination.
B. TERMINATION BY COMPANY WITHOUT CAUSE. In the event Executive is
terminated without Cause and upon the execution of a full general release by
Executive ("RELEASE"), releasing all claims known or unknown that Executive may
have under this Agreement against Company or New Frontier as of the date
Executive signs such Release, and upon the written acknowledgement of his
continuing obligations under the Proprietary Information Agreement and the
Non-competition Agreement, Company shall pay Executive associated termination
payments equal to Base Salary continuation through February 9, 2009, or six
(6) months of Base Salary, whichever is greater (the "WITHOUT CAUSE SEVERANCE
PAYMENTS"), plus the Accrued Obligations; provided, however, the Without Cause
Severance Payments shall be reduced in accordance with Section 5(G) (Mitigation
of Damages). The Without Cause Severance Payments will be paid in Company's
regular payroll cycle; provided, the Accrued Obligations shall be paid to
Executive on the Date of Termination. Business expenses reimbursable under
Company policy will be paid within ten (10) days after the final submittal of
outstanding business expenses, provided that Executive submits any outstanding
business expenses within ten (10) days after the Date of Termination. Vesting of
any stock options under any applicable Stock Option Plan shall cease vesting as
of the Date of Termination without Cause.
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C. TERMINATION BY EXECUTIVE FOR GOOD REASON. In the event Executive
resigns his employment with Company for Good Reason and upon the execution of a
Release against Company and New Frontier, releasing all claims known or unknown
that Executive may have under this Agreement against Company or New Frontier as
of the date Executive signs such Release, and upon the written acknowledgement
of his continuing obligations under the Proprietary Information Agreement and
the Non-competition Agreement, Company shall pay Executive associated
termination payments equal to Base Salary continuation through February 9,
2009, or six (6) months of Base Salary, whichever is greater ("GOOD REASON
SEVERANCE PAYMENTS"), plus the Accrued Obligations; provided, however, the Good
Reason Severance Payments shall be reduced in accordance with Section 5(G)
(Mitigation of Damages). The Good Reason Severance Payments will be paid in
Company's regular payroll cycle; provided, the Accrued Obligations shall be paid
to Executive on the Date of Termination. Business expenses reimbursable under
Company policy will be paid within ten (10) days after the final submittal of
outstanding business expenses, provided that Executive submits any outstanding
business expenses within ten (10) days after the Date of Termination. Vesting of
any stock options under any applicable Stock Option Plan shall cease vesting as
of the Date of Termination for Good Reason.
D. UPON DEATH. If Executive's employment is terminated by reason of
Executive's death during the Employment Period, this Agreement shall terminate
without further obligation to Executive's legal representatives under this
Agreement. Upon notice of Executive's death, Company shall pay to Executive's
estate all Accrued Obligations. Business expenses reimbursable under Company
policy will be paid with thirty (30) days after the final submittal of
outstanding business expenses, provided that Executive's estate submit any
outstanding business expenses within thirty (30) days after Executive's death.
Vesting of any stock options under any applicable Stock Option Plan shall be
governed by the terms of the Stock Option Plan and applicable Stock Option
grant.
E. UPON PERMANENT DISABILITY. If Executive's employment is
terminated by reason of Executive's Permanent Disability (as determined pursuant
to Section 3(C) of this Agreement) during the Employment Period, this Agreement
shall terminate without further obligation to Company. Company shall pay to
Executive, on the Date of Termination, all Accrued Obligations. Business
expenses reimbursable under Company policy will be paid within thirty (30) days
after the final submittal of outstanding business expenses, provided Executive
submit any outstanding business expenses within thirty (30) days after the Date
of Termination. Vesting of any stock options under any applicable Stock Option
Plan shall be governed by the terms of the Stock Option Plan and applicable
Stock Option grant.
F. APPLICATION OF SECTION 409A OF INTERNAL REVENUE CODE.
Notwithstanding anything contained in Section 5(B) or 5(C) to the contrary, to
the extent that (i) the parties' agreement regarding the Cause Severance
Payments or Good Reason Severance Payments, as applicable, to be made by Company
in accordance with this Agreement is treated as a "nonqualified deferred
compensation plan" within the meaning of Section 409A(d)(1) of the Internal
Revenue Code of 1986 (the "CODE"), (ii) the Executive is a "specified employee"
within the meaning of Section 409A(a)(2)(B)(i) of the Code, and (iii) Section
409A(a)(1)(A) of the Code would apply to any Cause Severance Payments or Good
Reason Severance Payments, as applicable, but for the application of Section
409A(a)(2)(A)(i) of the Code required to avoid the tax consequences of Section
409A of the Code, the first such severance payment under either scenario shall
cover all payments scheduled to be made to Executive during the first six (6)
months after the Date of Termination and such first payment shall be delayed
until the day after the six (6) month anniversary of the Date of Termination.
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G. PARACHUTE TAX GROSS UP. Executive acknowledges that neither the
Company nor New Frontier presently has, nor shall it have any obligation to
consider or institute, a policy or procedure (a "GROSS UP POLICY") that requires
the Company/New Frontier to pay any of its employees (including senior officers)
a "gross-up amount" providing employees entitled to any acceleration payments
with a "net" (or increased) payment amount that takes into account any
associated golden parachute excise tax ("PARACHUTE TAX") under Section 4999(a)
of the Code. Notwithstanding the foregoing, in the event New Frontier or the
Company during the Employment Period institutes a Gross Up Policy applicable to
one or more executives similarly situated to Executive in connection with any
acceleration payments owing or which could be owing to such executive(s),
Executive shall thereafter be entitled to participate in such Gross Up Policy.
H. MITIGATION OF DAMAGES. Executive shall not be obligated to seek
other employment to mitigate the amount of Without Cause Severance Payments or
the Good Reason Severance Payments payable to Executive hereunder; provided,
however, the amount of any Without Cause Severance Payments or Good Reason
Severance Payments shall be reduced, dollar for dollar, by an amount equal to
the gross amount that Executive earns (whether as an employee, contractor, or
director of any other business, trade, profession or occupation, and
irrespective of whether such form of compensation constitutes salary, bonus or
compensation) following (i) the termination of Executive without Cause, or (ii)
Executive's resignation for Good Reason, as applicable. Executive shall for so
long as any severance payments are due and owing to Executive, provide the
Company with contact information of any new employer of Executive (or such other
person or entity to whom Executive acts as a consultant or contractor) (each
referred to as a "THIRD PARTY EMPLOYER") following termination; Executive hereby
further authorizes Company to provide a copy of this Agreement to such Third
Party Employer and to obtain from such Third Party Employer, without Executive's
consent, all such information as may be reasonably requested by the Company to
ascertain the amount of compensation received by Executive from such Third Party
Employer, including without limitation, pay stubs, W-2's and/or Form 1099's
issued to Executive but only to the extent Executive does not first provide such
information to the Company within ten (10) days of written request.
6. NOTICE AND DATE OF TERMINATION. Any termination (whether based on
Permanent Disability, Good Reason, with Cause or without Cause) shall be
communicated by a written "NOTICE OF TERMINATION" to the other party, and may be
sent via registered or certified mail, return receipt requested, postage prepaid
or by facsimile transmission, or by electronic mail or by hand delivery. "DATE
OF TERMINATION" shall mean: (i) the date of transmission of the Notice of
Termination by facsimile, e-mail or personal delivery; (ii) three (3) calendar
days after the date of mailing by first class mail; or (iii) if Executive's
employment is terminated by reason of Executive's death, the Date of Termination
shall be the date of Executive's death.
7. PROPRIETARY AND OTHER OBLIGATIONS.
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A. PROPRIETARY INFORMATION AGREEMENT. Executive acknowledges that
signing and complying with the Proprietary Information Agreement is a condition
of his employment by Company. Executive therefore agrees to sign and comply with
the Proprietary Information Agreement and acknowledges that by beginning
employment with Company, he will be deemed to have signed and agreed to the
provision of the Proprietary Information Agreement.
B. EXCEPTIONS. Notwithstanding any contrary provisions in the
Proprietary Information Agreement to the contrary the parties agree as follows:
(i) the term "Proprietary Information", as defined in Section 1.2 of the
Proprietary Information Agreement, shall not include Executive's personal
address book; (ii) to the extent of any conflict between Section 2(A) of this
Agreement and the first sentence of paragraph 4 of the Proprietary Information
Agreement, Section 2(A) of this Agreement shall govern and control; (iii) the
last sentence of paragraph 7 of the Proprietary Information Agreement shall not
apply to Executive; (iv) a copy of all notices to be provided to Executive under
paragraph 9 of the Proprietary Information Agreement shall be delivered to
Michael Wolf, Esq., Wolf, Rifkin, Shapiro & Schulman, LLP, 11400 W. Olympic
Blvd., Ninth Floor, Los Angeles, California 90064; (v) promptly after providing
a notification described in paragraph 10 of the Proprietary Information
Agreement to any new employer of Executive, the Company will provide Executive
with a copy of the notice given to such new employer; and (vi) to the extent of
any conflict between any Section(s) of this Agreement and paragraph 11.5 of the
Proprietary Information Agreement, the Section(s) of this Agreement shall govern
and control.
8. NON-COMPETITION; NON-SOLICITATION. This Agreement shall not alter or
amend any of the non-competition or non-solicitation terms (nor any other terms)
set forth in the Non-competition Agreement or the Proprietary Information
Agreement.
9. ARBITRATION. To the fullest extent permitted by law, any controversy
or claim past, present, or future, arising out of or relating to the hiring of
Executive, Executive's employment, the termination of Executive's employment,
this Agreement and/or the breach or termination of this Agreement that Company
may have against Executive or that Executive may have against Company or against
its officers, directors, employees or agents in their capacity as such or the
breach hereof, shall be settled by a single arbitrator in arbitration conducted
in Los Angeles County, California, in accordance with the National Employment
Arbitration Rules of the American Arbitration Association ("AAA"). These rules
are posted on the AAA's website, . The arbitrators shall prepare a written award
and judgment upon the award may be entered in any court having jurisdiction
thereof. The arbitrator's decision shall be final and binding. The arbitrator
shall have the authority to settle such controversy or claim by finding that a
party should be enjoined from certain actions or be compelled to undertake
certain actions, and in such event such court may enter an order enjoining
and/or compelling such actions as found by that arbitrator. Each party shall pay
its own legal and other professional fees and costs in connection with the
arbitration and Company shall pay the arbitrator's fees; however, to the extent
permitted by law, the arbitrator may require the other party to pay the costs of
the arbitration and/or the legal and other professional fees and costs incurred
by the prevailing party in connection with such arbitration proceeding and any
necessary court action.
The claims covered by this arbitration provision include, but are not
limited to, claims arising out of contract law, tort law, common law, defamation
law, fraud law (including, without limitation, fraud in the inducement of
contract), wrongful discharge law, privacy rights, statutory protections,
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constitutional protections, wage and hour law, California Labor Code
protections, the California Fair Employment and Housing Act (which includes
claims for discrimination or harassment on the basis of age, race, color,
ancestry, national origin, disability, medical condition, marital status,
religious creed, sexual orientation, pregnancy, and sex), any similar state
discrimination law, the Federal Civil Rights Act of 1964 and 1991, as amended,
the Age Discrimination in Employment Act, the Older Workers' Benefit Protection
Act, the Americans With Disabilities Act; claims for benefits (except claims
under an employee benefit plan that either (1) specifies that its claims
procedure shall culminate in an arbitration procedure different from this one,
or (2) is underwritten by a commercial insurer which decides claims); and claims
for violation of any federal, state, or other governmental law, statute,
regulation, or ordinance, except claims excluded in the following section.
Notwithstanding the foregoing, the parties expressly agree that claims
Executive may have for workers' compensation, state unemployment compensation
benefits, and state disability insurance are not covered by this Agreement. The
parties also agree that a court of competent jurisdiction may enter a temporary
restraining order or an order enjoining a breach of this Agreement, including
Exhibit A (Confidentiality Agreement) hereto, pending a final award or further
order by the arbitrator. Such remedy, however, shall be cumulative and
nonexclusive, and shall be in addition to any other remedy to which the parties
may be entitled. The parties further expressly agree that this provision does
not apply to any matter in which the amount in controversy falls within the
jurisdiction of the Small Claims Division of the Municipal Courts of the State
of California. Should such matter fall within the jurisdiction of the Small
Claims Division of the Municipal Court of the State of California, then such
matter shall be, and may only be, submitted to a Small Claims Division of the
Courts of the State of California for Los Angeles County for determination.
This Section 9 shall apply notwithstanding any provision to the
contrary which is set forth in the Purchase Agreement; provided however, Company
shall, in the event of any arbitration under this Section 9, continue to have
(and the arbitrator shall take into account in rendering any award hereunder)
all of its offset rights contained in applicable provisions of the Purchase
Agreement.
10. NO CONFLICTING OBLIGATIONS OF EXECUTIVE. Executive represents and
warrants that he is not subject to any duties or restrictions under any prior
agreement with any previous employer or other person or entity other than
Company, and that he has no rights or obligations which may conflict with the
interests of Company or with the performance of Executive's duties and
obligations under this Agreement. Executive agrees to notify Company immediately
if any such conflicts occur in the future.
11. DIRECTOR AND OFFICER INSURANCE AND INDEMNITY. To the extent that
New Frontier maintains Director and Office Insurance on similarly situated
executives of other subsidiaries, New Frontier shall obtain and pay the premiums
upon director and officer insurance and shall name Executive as an insured under
such policies. Company shall further indemnify and hold harmless Executive as
required under Company's articles of incorporation or bylaws and, without
limiting the generality of the foregoing, Company shall indemnify and hold
harmless Executive to the maximum extent required by California law.
12. SUCCESSORS. This Agreement is personal to Executive and shall not
be assignable by Executive. This Agreement shall inure to the benefit of Company
and its successors and assigns. Upon written approval by Executive, Company may
assign this Agreement to any successor or affiliated entity, subsidiary or
parent company, but no such assignment shall relieve Company of its obligations
under this Agreement.
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13. MISCELLANEOUS.
A. MODIFICATION/WAIVER. This Agreement may not be amended, modified,
superseded, canceled, renewed or expanded, or any terms or covenants hereof
waived, except by a writing executed by each of the parties hereto or, in the
case of a waiver, by the party waiving compliance. Failure of any party at any
time or times to require performance of any provision hereof shall in no manner
affect his or its right at a later time to enforce the same. No waiver by a
party of a breach of any term or covenant contained in this Agreement, whether
by conduct or otherwise, in any one or more instances shall be deemed to be or
construed as a further or continuing waiver of agreement contained in the
Agreement.
B. TAXES. Executive agrees to be responsible for the payment of any
taxes due on any and all compensation, stock option, or benefit provided by
Company pursuant to this Agreement. Executive agrees to indemnify Company and
hold Company harmless from any and all claims or penalties asserted against
Company for any failure by Executive to pay taxes due on any compensation, stock
option, or benefit provided by Company pursuant to this Agreement. Executive
expressly acknowledges that Company has not made, nor herein makes, any
representation about the tax consequences of any consideration provided by
Company to Executive pursuant to this Agreement.
C. GOVERNING LAW; PERSONAL JURISDICTION. This Agreement and all
disputes relating to this Agreement shall be governed in all respects by the
laws of the State of California as such laws are applied to agreements between
California residents entered into and performed entirely in California. The
parties acknowledge that this Agreement constitutes the minimum contacts to
establish personal jurisdiction in California. The captions of this Agreement
are not part of the provisions hereof and shall have no force or effect.
D. NOTICES. All notices and other communications hereunder
(including any notices pursuant to Section 6) shall be in writing and shall be
given by hand delivery to the other party or by registered or certified mail,
return receipt requested, postage prepaid, or by facsimile, or by email, or by
hand delivery to such address as either party shall have furnished to the other
in writing in accordance herewith. Copies of all notices sent hereunder shall be
forwarded to Michael Wolf, Esq., Wolf, Rifkin, Shapiro & Schulman, LLP, 11400
West Olympic Boulevard, Ninth Floor, Los Angeles, California 90064 and to E. Lee
Reichert, Esq., Kamlet Shepherd & Reichert, LLP, 1515 Arapahoe Street, Ste.
1600, Denver, Colorado 80202.
E. SEVERABILITY. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
F. WITHHOLDINGS. Company may withhold from any amounts payable under
this Agreement such federal, state or local taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
10
G. ENTIRE AGREEMENT. This Agreement, together with Exhibit A
attached hereto, set forth the entire agreement and understanding of the parties
hereto with regard to the employment of the Executive by Company and supersede
any and all prior agreements, arrangements and understandings, written or oral,
pertaining to the subject matter hereof. No representation, promise or
inducement relating to the subject matter hereof has been made to a party that
is not embodied in these Agreements, and no party shall be bound by or liable
for any alleged representation, promise or inducement not so set forth.
Notwithstanding this Section 13(G), nothing contained in this Agreement shall
alter, amend or effect in any way the terms and conditions of the Purchase
Agreement or the Non-competition Agreement.
H. WAIVER. The failure of either party to insist upon strict
compliance with any provision of this Agreement, or the failure to assert any
right either party may have hereunder, shall not be deemed to be a waiver of
such provision or right or any other provision or right of this Agreement.
IN WITNESS WHEREOF, Executive has hereunto set Executive's hand, and
Company has caused these presents to be executed in its name on its behalf, all
as of the day and year first above written.
COMPANY: EXECUTIVE:
MRG Entertainment, Inc.,
a California corporation
By: /s/ Richard Bruce Goldberg /s/ Marc Laurence Greenberg
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Name: Richard Bruce Goldberg Marc Laurence Greenberg
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Its: Co-President
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