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Exhibit 10.06
EMPLOYMENT AGREEMENT
This AGREEMENT (the Agreement) is entered into as of May 2, 2003 by and between GHP Acquisition Corp., a Delaware corporation with its headquarters located in Brisbane, California (the Employer), and Mark Jung (the Executive) and will become effective (the Effective Date) upon the Closing as defined in that certain Agreement and Plan of Merger dated as of the date hereof by and among the Employer and IGN Entertainment, Inc., a Delaware corporation (the Merger Agreement). In consideration of the mutual covenants contained in this Agreement, the Employer and the Executive agree as follows:
1. Employment. The Employer agrees to employ the Executive and the Executive agrees to be employed by the Employer on the terms and conditions set forth in this Agreement.
2. Capacity. The Executive shall initially serve the Employer as Chief Executive Officer, subject to election by the Board of Directors, of the Employer (the Board of Directors) and as a member of the Board of Directors, subject to election by the shareholders of the Employer. The Executive shall also serve the Employer in such other or additional offices as the Executive may be requested to serve by the Board of Directors. In such capacity or capacities, the Executive shall perform such services and duties in connection with the business, affairs and operations of the Employer as may be assigned or delegated to the Executive from time to time by or under the authority of the Board of Directors.
3. Term. Subject to the provisions of Section 6, the term of employment pursuant to this Agreement (the Term) shall be three (3) years from the Effective Date and shall be renewed automatically for periods of one (1) year commencing at the third anniversary of the Effective Date and on each subsequent anniversary thereafter, unless either the Executive or the Employer gives written notice to the other not less than sixty (60) days prior to the date of any such anniversary of such partys election not to extend the Term.
4. Compensation and Benefits. The regular compensation and benefits payable to the Executive under this Agreement shall be as follows:
(a) Salary. For all services rendered by the Executive under this Agreement, the Employer shall pay the Executive a salary (the Salary) at the annual rate of Three Hundred Thousand Dollars ($300,000), subject to adjustment from time to time in the discretion of the Board of Directors or the Compensation Committee of the Board of Directors (the Compensation Committee). The Salary shall be payable in periodic installments in accordance with the Employers usual practice for its senior executives.
(b) Bonus. In the event that an annual incentive program established by the Board of Directors or the Compensation Committee with such terms as may be established in the sole discretion of the Board of Directors or Compensation Committee, the Executive shall be entitled to participate in such program.
(c) Regular Benefits. The Executive shall also be entitled to participate in any employee benefit plans, medical insurance plans, life insurance plans, disability income plans, retirement plans, vacation plans, expense reimbursement plans and other benefit plans which the Employer may from time to time have in effect for all or most of its senior executives. Such participation shall be subject to the terms of the applicable plan documents, generally applicable policies of the Employer, applicable law and the discretion of the Board of Directors, the Compensation Committee or any administrative or other committee provided for in or contemplated by any such plan. Nothing contained in this Agreement shall be construed to create any obligation on the part of the Employer to establish any such plan or to maintain the effectiveness of any such plan which may be in effect from time to time.
(d) Taxation of Payments and Benefits. The Employer shall undertake to make deductions, withholdings and tax reports with respect to payments and benefits under this Agreement to the extent that it reasonably and in good faith believes that it is required to make such deductions, withholdings and tax reports. Payments under this Agreement shall be in amounts net of any such deductions or withholdings. Nothing in this Agreement shall be construed to require the Employer to make any payments to compensate the Executive for any adverse tax effect associated with any payments or benefits or for any deduction or withholding from any payment or benefit.
(e) Restricted Stock Agreement. The Employer shall grant to the Executive the right to purchase shares of common stock, par value $0.01 per share, of the Employer in an amount and on terms and conditions set forth in the Restricted Stock Agreement attached hereto as Exhibit A (the Restricted Stock Agreement).
(f) Life Insurance Policy. The Employer shall purchase a life insurance policy on Executive with proceeds of One Million Dollars ($1,000,000) for the benefit of Executives family (as specified by Executive). The Employer shall pay all premiums and other costs required to maintain such policy during Executives employment with Employer.
(g) Organization Fees. The Company shall pay all fees and normal expenses associated with Executives participation in the Young Presidents Organization up to a maximum of Twenty Thousand Dollars ($20,000) per year.
(h) Exclusivity of Salary and Benefits. The Executive shall not be entitled to any payments or benefits other than those provided under this Agreement.
5. Extent of Service. During the Executives employment under this Agreement, the Executive shall, subject to the direction and supervision of the Board of Directors, devote the Executives full business time, best efforts and business judgment, skill and knowledge to the advancement of the Employers interests and to the discharge of the Executives duties and responsibilities under this Agreement. The Executive shall not engage in any other business activity, except as may be approved by the Board of Directors; provided that nothing in this Agreement shall be construed as preventing the Executive from:
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(a) investing the Executives assets in any company or other entity in a manner not prohibited by Section 7(d) and in such form or manner as shall not require any material activities on the Executives part in connection with the operations or affairs of the companies or other entities in which such investments are made;
(b) engaging in religious, charitable or other community or non-profit activities that do not impair the Executives ability to fulfill the Executives duties and responsibilities under this Agreement;
(c) serving on the boards of directors of up to three companies (other than the Company) subject to the Board of Directors approval which approval shall not be unreasonably withheld or delayed; or
(d) participating in the normal activities expected of a member of the Young Presidents Organization.
6. Termination and Termination Benefits. Notwithstanding the provisions of Section 3, the Executives employment under this Agreement shall terminate under the following circumstances set forth in this Section 6.
(a) Constructive Termination of Executive. The Executive shall have the right to terminate this Agreement due to a Constructive Termination. For purposes of this Agreement, Constructive Termination means the occurrence, without the Executives express written consent, of any one or more of the following events:
(i) (A) the Executives not being the Chief Executive Officer of the Company, except in connection with the Companys termination of the Executives employment for Cause pursuant to Section 6(b) or as otherwise expressly contemplated herein; (B) the assignment of duties to the Executive not consistent with the office of the Chief Executive Officer of the Company; or (C) the Executives not reporting to the Companys Board of Directors;
(ii) A reduction in the Executives Salary or a material reduction in the value of the Executives total compensation package (salary, bonus opportunity, equity incentive awards opportunity and benefits);
(iii) The relocation of the Executives principal Company office to a location more than sixty (60) miles from Brisbane, California or the Companys requiring the Executive to be based anywhere other than the Companys principal executive offices, except for required travel on the Companys business to the extent necessary to fulfill the Executives obligations;
(iv) A failure to re-elect the Executive as a member of the Companys Board of Directors; or
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(v) In the event of a merger, consolidation, transfer, or sale of all or substantially all the assets of the Company with or to any other individual or entity, the failure of the Companys successor to assume the Companys obligations under this Agreement.
(b) Termination by the Employer for Cause. The Executives employment under this Agreement may be terminated for Cause without further liability on the part of the Employer effective immediately upon a vote of the Board of Directors and written notice to the Executive. Only the following shall constitute Cause for such termination:
(i) dishonest statements or acts of the Executive with respect to the Employer or any affiliate of the Employer where such act causes material harm to the Employer;
(ii) the conviction of the Executive for (A) a felony or (B) any misdemeanor involving moral turpitude, deceit, dishonesty or fraud ;
(iii) gross negligence, willful misconduct or insubordination of the Executive with respect to the Employer or any affiliate of the Empl






