Mr. Wayne
Levin
Via Personal Delivery
Re.:
Employment Agreement
On behalf of Lions
Gate Films Inc. (“Company”), this is to confirm the
terms of your employment by the Company. We refer to you herein as
“Employee”. The terms of Employee’s employment
from this date forward are as follows:
1. The term
of this agreement (“Agreement”) will begin
April 1, 2006 and end March 31, 2009
(“Term”). During the Term of this Agreement, Employee
will serve as General Counsel and Executive Vice President,
Corporate Operations. Employee shall report to the CEO in his
capacity as General Counsel and to the COO, or person performing
substantially such role in his capacity as Executive Vice
President, Corporate Operations. For the purpose hereof, Employee
agrees that Steve Beeks performs such function. 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 Company.
The Company may,
at its sole discretion, extend the Term of this Agreement for an
additional year, commencing April 1, 2009 and ending
March 31, 2010 (“Option Year”) by giving notice to
Employee of its election to extend this Agreement at least
180 days before that date.
So long as this
Agreement shall continue in effect, Employee shall devote
Employee’s full business time, energy and ability exclusively
to the business, affairs and interests of the Company and matters
related thereto, shall use Employee’s best efforts and
abilities to promote the Company’s interests and shall
perform the services contemplated by this Agreement in accordance
with policies established by the Company.
2. (a) The
following compensation will be paid to Employee during the Term of
this Agreement:
Base Salary . During the Term of this Agreement, the Company
agrees to pay Employee a base salary as follows:
For
first year of the Term, the rate of $400,000 per year, payable in
accordance with the Company’s normal payroll practices in
effect.
For
the remainder Term, the rate of $500,000 per year, payable in
accordance with the Company’s normal payroll practices in
effect.
During
the Option year, the rate of $600,000 per year, payable in
accordance with the Company’s normal payroll practices in
effect.
Nothing
in this Agreement shall limit the Company’s right to modify
its payroll practices, as it deems necessary.
(i) An annual
bonus at the full discretion of the CEO;
(ii) An annual
bonus of 25% of Base Salary based upon Established Goals. The
Established Goals shall be set forth in writing at the beginning of
each fiscal, and shall be discussed in good faith between Company
and Employee;
(iii) An annual
bonus of 25% of Base Salary based upon the EBITDA of the Company on
a most favored nation basis with any person receiving an EBITDA
based bonus. For the sake of clarity, the MFN basis applies to the
definition of EBITDA, the EBITDA target, and the percentages of
Base Salary payable at various levels if the EBITDA target;
and
(iv) Change of
Control of Bonus: For the purposes of this Agreement, Change of
Control shall have the same meaning as set forth in the employment
agreement of Michael Burns, dated as of September 1, 2003.
Company shall pay Employee a Bonus of $1,000,000 upon a Change of
Control. Notwithstanding anything to the contrary, this Change of
Control Bonus shall vest 100% if discussions relating and leading
to the Change of Control commence during the Term hereof whether
are not the Change of Control is actually consummated after the
Term or the termination hereof. However, this bonus shall unvest
and not be payable if the principal agreement giving rise to the
Change of Control is not signed within one year of Employee’s
termination of employment.
(iv) Two Past
Services Bonuses: The first in the amount of $100,000, which shall
be paid April 3, 2006; and the Second in the amount of
$125,000 which shall be paid April 3, 2007. These Bonuses
shall not be applicable against any other Bonus and shall not be
counted as any portion of Employee’s bonus for the fiscal
year 2006.
3. As an
employee of the Company, Employee will continue to be eligible to
participate in all benefit plans, including Senior Management
Plans, to the same extent as other employees, subject to the terms
of such plans.
4. Employee
shall be entitled to take paid time off without a reduction in
salary, subject to (i) the approval of Employee’s
supervisor, and (ii) the demands and requirements of
Employee’s duties and responsibilities under the Agreement.
There are no paid vacation days. Finally, Employee will be eligible
to be reimbursed for any business expenses in accordance with the
Company’s current Travel and Entertainment policy. The
forgoing notwithstanding, Employee’s travel and entertainment
shall be on a most favored nations basis with all other Presidents
of Divisions.
5. Company
shall request that the Compensation Committee of Lions Gate
(“CCLG”) authorize and grant Employee 100,000 common
share units (“Grants”) of Lions Gate Entertainment
Corp. in accordance with the terms and conditions of the existing
and/or future Employee Stock Plan (“Plan”). Employee
acknowledges that this Grant of stock is subject to the approval of
the CCLG. The award date (“Award Date”) shall be the
date of the board meeting when the Grant is approved. The Grant
shall vest as follows:
50% on March 31, 2008 and 50%
on March 31, 2009
When the Company
obtains an additional allotment of shares under the Plan, Company
shall grant Employee 25,000 common share units (“ Further
Grants”) of Lions Gate Entertainment Corp. in accordance with
the terms and conditions of the existing and/or future Employee
Stock Plan (“Plan”). The Grant shall vest as
follows:
50% on March 31, 2008 and 50%
on March 31, 2009
If the Company
does not obtain an addition allotment of shares, then it shall pay
Employee in cash the value of such Further Grants on the date such
Further Grants were to have vested.
If any
employee’s stock options or shares that are issued under the
Employee Stock Option Plan accelerate in vesting schedule as a
result of a change of control, Employee’s previously stock
options, Further Grants, and shares issued hereunder shall likewise
accelerate in vesting schedule
For the sake of
clarity, all options granted under Employee’s prior
employment agreement shall continue to vest in accordance with the
terms of such prior agreement.
Employee
represents and warrants that during the Term hereof, Employee shall
hold at least 5000 shares of common shares of the
Company.
6. Employee
agrees that the Company Employee Handbook outlines other policies,
which will apply to Employee’s employment, and Employee
acknowledges receipt of such handbook. Please note, however, that
the Company retains the right to revise, modify or delete any
policy or benefit plan it deems appropriate.
7. This
Agreement shall terminate upon the happening of any one or more of
the following events:
(a) The
mutual written agreement between Company and Employee;
or
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