Employment Agreement [Amendment] - Marvel Enterprises Inc. and Avi Arad
January 3, 2000
Dear Avi:
Reference is made to the Employment Agreement between Toy Biz, Inc., now known
as Marvel Enterprises Inc.("Marvel") and yourself ("Executive") dated as of
September 30, 1998 (the "Employment Agreement"). All terms defined in the
Employment Agreement shall have the same meaning as set forth therein.
In consideration of One Dollar ($1.00) and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Marvel and Executive hereby agree that the Employment Agreement is amended
effective January 1, 2001 in the following respects:
1. Section 1.3 is hereby amended to read as follows:
1.3 Location. The duties to be performed by the Executive
hereunder shall be performed primarily at the principal executive
office of the Company in the Los Angeles metropolitan area, subject to
reasonable and customary travel requirements on behalf of the Company.
2. Section 2.1, The Term, is hereby amended by extending the
expiration date from December 31, 2000 to December 31, 2002.
3. Section 4.5, Change in Control, shall be amended to read:
4.5 Change in Control.
(a) If on or after the date hereof, and prior to the end of
the Term, there occurs a "Change in Control" the Executive shall have
the right, at any time within thirty (30) days of obtaining knowledge
of such Change in Control, to give notice to the Company of termination
of the Term as of a date (which shall not be earlier than ten (10) days
from such notice) to be specified in such notice, and the Term shall
terminate on the date so specified.
(b) For purposes of this Agreement, a Change in Control shall
be deemed to have occurred if (i) any "person" or "group" (as such
terms are used in Sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")), other than an Excluded
Person or Excluded Group (as defined below) (hereinafter, a "Third
Party"), is or becomes the "beneficial owner" (as defined in Rule 13d-3
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promulgated under the Exchange Act), directly or indirectly, of
securities of the Company representing fifty percent (50%) or more of
the combined voting power of the Company's then outstanding securities
entitled to vote in the election of directors of the Company, (ii) the
Company is a party to any merger, consolidation or similar transaction
as a result of which the shareholders of the Company immediately prior
to such transaction beneficially own securities of the surviving entity
representing less than fifty percent (50%) of the combined voting power
of the surviving entity's outstanding securities entitled to vote in
the election of directors of the surviving entity or (iii) all or
substantially all of the assets of the Company are acquired by a Third
Party. "Excluded Group" means a "group" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) that (i) includes one or
more Excluded Persons; provided that the voting power of the voting
stock of the Company "beneficially owned" (as such term is used in Rule
13d-3 promulgated under the Exchange Act) by such Excluded Persons
(without attribution to such Excluded Persons of the ownership by other
members of the "group") represents a majority of the voting power of
the voting stock "beneficially owned" (as such term is used in Rule
13d-3 promulgated under the Exchange Act) by such group or (ii) exists
solely by virtue of the fact that the members of such group are parties
to the Stockholders' Agreement, dated as of October 1, 1998, by and
among the Company, Isaac Perlmutter, Avi Arad, Mark Dickstein, The
Chase Manhattan Bank, Morgan Stanley & Co. Incorporated, Whippoorwill
Associates Incorporated and various other stockholders of the Company,
as that agreement may be amended from time to time (the "Stockholders
Agreement"). "Excluded Person" means (i) while the Stockholders
Agreement is in effect in substantially its current form, any person or
entity who or which is a party to the Stockholders Agreement as of the
Effective Date and any affiliate of such a party to the Stockholders
Agreement who becomes a party to the Stockholders Agreement, and (ii)
Isaac Perlmutter and Avi Arad or any of their affiliates.
4. Schedule II, Additional Benefits, shall be amended to read as follows:
1. The Company shall provide the Executive use of a Mercedes 500 SEL or
similar automobile.
2. The Executive shall be entitled to participate in the Company's
stock option plan at a level commensurate with Executive's salary
level, title and responsibilities, as determined by the
Compensation Committee of the Board of Directors of the Company
3. With respect to each media project for which the Executive performs
significant services, the Executive shall be entitled to retain, in
addition to the Base Salary and other benefits provided for hereunder,
the following Executive Producer and/or Producer fees customarily
payable by the licensee under any television or motion picture entered
into by the Company during the Term:
a) $350,000 for any one motion picture project
b) $10,000 per episode for animated network television
projects
c) $7,500 per episode for animated syndicated television
projects
d) $20,000 per episode for live action television projects
of at least one hour.
4. In recognition of the cost savings to the Company resulting from the
Executive relocating from the New York to Los Angeles area, the
Company shall pay Executive during the Term a special bonus at the
annual rate of $75,000, payable bi-weekly, less such deductions or
amounts to be withheld as required by applicable law and regulations.
Except as otherwise expressly hereinabove provided, the terms and
conditions of the E Employment Agreement shall remain in full force and effect.
If the foregoing accurately reflects your understanding of our agreement,
please indicate by signing in the appropriate place below.
Very truly yours,