AMENDED AND RESTATED

EMPLOYMENT AGREEMENT

 

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is made and
entered into as of this 16th day of September, 2014, by and between Wizard
World, Inc., a Delaware corporation with offices at 225 California Street, El
Segundo, California 90245 (the “Company”), and John Macaluso, an individual and
resident of the State of California with an office address c/o Wizard World,
Inc., 225 California Street, El Segundo, California 90245 (the “Executive” and,
together with the Company, the “Parties” and each, a “Party”).

 

RECITALS

 

A. Executive and Company entered into an employment agreement as of March 19,
2012 (the “Original Employment Agreement”), which will expire by its own terms
on March 18, 2015.

 

B. Executive has met each and every performance objective of the Company and
Executive possesses certain knowledge and skills relating to the Company’s
business that the Company wishes to retain for the development and success of
the Company’s business.

 

C. The Company wishes to continue to employ Executive, and Executive wishes to
continue to be employed by the Company, on the terms and conditions contained
herein.

 

D. The Company and the Executive wish to enter into this Agreement to amend and
restate the Original Employment Agreement to extend the end of the term of
Executive’s employment, on the terms and conditions as set forth in this
Agreement.

 

NOW, THEREFORE, in consideration of the premises set forth above and for other
good and valuable consideration mutually exchanged by the Parties, the receipt
and sufficiency of which is hereby acknowledged, the Parties hereby agree as
follows:

 

1. Employment. The Company hereby employs Executive, and Executive hereby
accepts employment, as President and Chief Executive Officer of the Company,
subject to the terms and conditions set forth in this Agreement.

 

2. Duties. As President and Chief Executive Officer, Executive shall have such
duties, responsibilities and authority as are commensurate and consistent with
his position and as are assigned to him by the Board of Directors of the Company
(the “Board”). Such duties shall include, without limitation, responsibility for
all ongoing operations of the Company and responsibility for insuring that the
Company meets all stated financial goals and objectives. Specific duties may
include preparing materials for and participating in review meetings with the
Board (the “Review Meetings”). The Board shall determine from time to time and
advise Executive regarding the agenda for the Review Meetings and the required
supporting documents and analyses, which are generally expected to include
budgets, growth prospects, projections and targets, as well as comparisons with
respect to prior periods. The Board shall also determine from time to time the
frequency and timing of the Review Meetings. The Executive shall also provide to
the Board, from time to time upon its request, but in no event later than
December 31, 2014, an organizational chart that sets forth contingency plans for
the appointment or promotion of successors to key management positions (the
“Succession Plan”). In addition, the Executive shall provide to the Board by no
later than October 31, 2014, an employee stock ownership plan detailing the
Executive’s recommendations to incentivize the Board and the Company’s employees
and advisors (the “ESOP”). Executive shall report directly to the Board. During
the Term (as defined herein), Executive shall devote his full business time and
efforts to the performance of his duties hereunder, unless otherwise explicitly
authorized by the Board. The services to be provided by Executive may, at the
option of the Board, be performed in either Los Angeles, California, New York,
New York or Las Vegas, Nevada. Notwithstanding the foregoing, the expenditure of
reasonable amounts of time by Executive for the making of passive personal
investments, the conduct of private business affairs and charitable activities
shall be allowed, provided that such activities do not materially interfere with
the services required to be rendered to the Company hereunder and do not violate
the restrictive covenants set forth herein.

 

1

 

 

3. Term of Employment. Under the Original Employment Agreement, the term of
executive’s employment commenced on March 19, 2012. Commencing on the date
hereof (the “Commencement Date”), the term of Executive’s employment hereunder,
unless sooner terminated as provided herein, shall be for a period of four (4)
years from the Commencement Date, ending on March 18, 2018 (the “Initial Term”).
The term of this Agreement shall automatically be extended for additional terms
of one (1) year each (each a “Renewal Term”), unless either Party gives prior
written notice of non-renewal (“Non-Renewal Notice”) to the other Party no later
than sixty (60) days prior to the expiration of the then current Term (as
defined herein). For purposes of this Agreement, the Initial Term and any
Renewal Term are hereinafter collectively referred to as the “Term.”

 

4. Compensation of Executive.

 

(a) Base Salary. Beginning September 1, 2014, the Company shall pay Executive as
compensation for his services hereunder, in equal installments paid twice per
month during the Term, a base salary of $41,666.67 per month for an aggregate of
$500,000 per year (the “Base Salary”), less such deductions as shall be required
to be withheld by applicable law and regulations. In addition to the foregoing,
the Executive shall be paid $62,900 by the Company for services provided by the
Executive during the period June 1, 2014 through August 31, 2014 to reflect the
new Base Salary retroactive to June 1, 2014.

 

(b) Annual Bonus. In addition to the Base Salary, provided that in the Board’s
determination the Executive has performed the duties set forth in Section 2
hereof, including timely providing sufficient materials in connection with the
Review Meetings and delivering the Succession Plan and ESOP, the Executive shall
receive an annual bonus equal to the following, calculated cumulatively:

 

(i) When the Company achieves annual Adjusted EBITDA of between $1.00 and
$1,000,000, the Executive shall receive a cash bonus of 30% of such annual
Adjusted EBITDA;

 

2

 

 

(ii) When the Company achieves annual Adjusted EBITDA of between $1,000,001 and
$2,000,000, the Executive shall receive an additional cash bonus of 20% of such
annual Adjusted EBITDA which exceeds $1,000,000; and

 

(iii) When the Company achieves annual Adjusted EBITDA greater than $2,000,000,
the Executive shall receive an additional cash bonus of 10% of such annual
Adjusted EBITDA which exceeds $2,000,000.

 

For purposes herein, “Adjusted EBITDA” shall mean earnings before interest,
taxes, depreciation and amortization, the components of which shall be
calculated in accordance with generally accepted accounting principles (“GAAP”)
and as such components traditionally appear on the Company’s audited financial
statements, excluding any and all expenditures associated (i) with any
share-based payment; (ii) with any gain or loss related to derivative
instruments; (iii) in connection with or arising out of the strategic
relationship with Cinedigm Corp. (“Cinedigm”), in each case, which have been
approved by the Board, for the fiscal years ended December 31, 2014 and 2015
only, in accordance with the following: (a) all GAAP profit and loss activity in
relation to the stragetic relationship with Cinedigm will be reversed out of the
Adjusted EBITDA calucuation, and (b) fifty percent (50%) of all cash paid into
the strategic relationship with Cinedigm by the Company shall be included as a
deduction in the Adjusted EBITDA calculation, and fifty percent (50%) of all net
cash received from such strategic relationship shall be included in the Adjusted
EBITDA calculation; and (iv) with any other non-cash expenses reasonably
approved by the Board. For avoidance of doubt and by way of example, if the
Board approved cash payments by the Company into the strategic relationship with
Cinedigm equal to $1,000,000 for the year ended December 31, 2015, $500,000 of
such cash payments shall be included as a deduction in the Adjusted EBITDA
calculation in accordance with the formula set forth in sub-paragraph (iii)
above. In addition, if net cash received from the strategic relationship with
Cinedigm equals $100,000, then $50,000 should be included in the Adjusted EBITDA
calculation.

 

(c) Equity. As additional consideration for entering into this Agreement, the
Executive shall receive the following:

 

(i) 763,888 options to purchase shares of the Company’s common stock, which have
already been issued to Executive pursuant to the Original Employment Agreement,
such options vesting quarterly over the period ending March 18, 2015, at an
exercise price of $0.44 per share;

 

(ii) 900,000 options to purchase shares of the Company’s common stock, such
options vesting quarterly over the period beginning March 19, 2015 and ending
March 18, 2016, at an exercise price of $1.00 per share;

 

(iii) 900,000 options to purchase shares of the Company’s common stock, such
options vesting quarterly over the period beginning March 19, 2016 and ending
March 18, 2017, at an exercise price of $1.25 per share; and

 

3

 

 

(iv) 900,000 options to purchase shares of the Company’s common stock, such
options vesting quarterly over the period beginning March 19, 2017 and ending
March 18, 2018, at an exercise price of $1.50 per share.

 

(d) Expenses. The Company shall advance or reimburse Executive for all
reasonable auditable, out-of-pocket expenses actually incurred or paid by
Executive in the course of his employment, consistent with the Company’s policy
for reimbursement of expenses from time to time, including travel expenses. For
greater certainty, “reasonable” for purposes of this provision with respect to
airfare for travel greater than two hours shall be deemed to be (i) a first
class or other premium airline ticket when there are only two (2) classes of
tickets available for any given flight and (ii) a business airline ticket when
there are three (3) or more classes of tickets available for any given flight.

 

(e) Benefits. With the exception of the ESOP, Executive shall be entitled to
participate in such pension, profit sharing, group insurance, hospitalization,
and group health (for Executive and his immediate family) and benefit plans and
all other benefits and plans, including perquisites, if any, as the Company
provides to its senior executives (the “Benefit Plans”).

 

(f) Car Allowance. During the Term, the Company shall pay Executive, on the
first day of each month, a monthly car allowance of $1,200.00 to pay for the
costs associated with Executive’s local transportation expenses.

 

5. Termination.

 

(a) This Agreement and Executive’s employment hereunder shall terminate upon the
happening of any of the following events:

 

(i) upon Executive’s death;

 

(ii) upon Executive’s Total Disability;

 

(iii) upon the expiration of the Initial Term of this Agreement or any Renewal
Term thereof, if either Party has provided a timely Non-Renewal Notice;

 

(iv) at Executive’s option, in the event of an act by the Company constituting
“Good Reason” (as defined herein) for termination by Executive; or

 

(v) at the Company’s option, in the event of an act by Executive constituting
“Cause” for termination by the Company.

 

(b) For purposes of this Agreement, Executive shall be deemed to be suffering
from a “Total Disability” if Executive is (i) unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment that can be expected to result in death, or last for a
continuous period of not less than 12 months; (ii) by reason of any medically
determinable physical or mental impairment that can be expected to result in
death, or last for continuous period of not less than 12 months, receiving
income replacement benefits for a period of not less than three months under an
accident and health plan covering employees of the Company; or (iii) determined
to be totally disabled by the Social Security Administration. Any question as to
the existence of a disability shall be determined by the written opinion of
Executive’s regularly attending physician (or his guardian) (or the Social
Security Administration, where applicable).

 

4

 

 

(c) For purposes of this Agreement, the term “Good Reason” shall mean that
Executive has resigned due to (i) any material diminution in Executive’s
authority, duties or responsibilities (unless Executive has agreed to such
diminution); (ii) a material change in the chain of reporting referenced in
Section 2 (unless Executive has agreed to such change); (iii) other than as
expressly set forth herein, any material diminution in Executive’s Base Salary
(unless Executive has agreed to such diminution); (iv) any material change in
the geographic location at which Executive must perform services to a location
outside of the Los Angeles, California or Las Vegas, Nevada without Executive’s
prior written consent; (v) any material violation by the Company of its
obligations under this Agreement; or (vi) Executive shall not be a duly
appointed or duly elected member of the Board. Prior to Executive terminating
his employment with the Company for Good Reason, Executive must provide written
notice to the Company within ninety (90) days following the initial existence of
such condition, that such Good Reason exists and setting forth in detail the
grounds Executive believes constitutes Good Reason. If the Company does not cure
the conditions constituting Good Reason within ninety (90) days after receipt of
written notice thereof from Executive, then Executive’s employment shall be
deemed terminated for Good Reason as of the date of Executive’s notice to the
Company.

 

(d) For purposes of this Agreement, the term “Cause” shall mean any material
breach of this Agreement or repeated material, gross and willful misconduct on
the part of Executive in connection with his employment duties hereunder, in all
cases that is not cured within fourteen (14) business days after receipt of
written notice thereof (to the extent such breach is capable of being cured), or
Executive’s conviction of or entering of a guilty plea or a plea of no contest
with respect to a felony or any crime involving fraud, larceny or embezzlement
resulting in material harm to the Company by Executive.

 

6. Effects of Termination

 

(a) Upon termination of Executive’s employment pursuant to Section 5(a)(i) or
(ii), in addition to the accrued but unpaid compensation and vacation pay
through the date of death or Total Disability and any other benefits accrued to
him under any Benefit Plans outstanding at such time and the reimbursement of
documented, unreimbursed expenses incurred prior to such date, Executive or his
estate or beneficiaries, as applicable, shall be entitled to the following
severance benefits: (i) six (6) months’ Base Salary at the then current rate,
payable in a lump sum, less withholding of applicable taxes; (ii) continued
provision for a period of twelve (12) months following Executive’s death of
benefits under Benefit Plans extended from time to time by the Company to its
senior executives; and (iii) payment on a pro-rated basis of any bonus or other
payments earned in connection with any bonus plan to which Executive was a
participant as of the date of death or Total Disability.

 

(b) Upon termination of Executive’s employment pursuant to Section 5(a)(iii),
where the Company has offered to renew the term of Executive’s employment for an
additional one (1) year period and Executive chooses not to continue in the
employ of the Company, Executive shall be entitled to receive only the accrued
but unpaid compensation and vacation pay through the date of termination and any
other benefits accrued to him under any Benefit Plans outstanding at such time
and the reimbursement of documented, unreimbursed expenses incurred prior to
such date. In the event the Company tenders a Non-Renewal Notice to Executive,
then Executive shall be entitled to the same severance benefits as if
Executive’s employment were terminated pursuant to Section 5(a)(iv); provided,
however, if such Non-Renewal Notice was triggered due to the Company’s statement
that Executive’s employment was terminated due to Section 5(a)(v), then payment
of severance benefits will be contingent upon a determination as to whether
termination was properly for “Cause.”

 

5

 

 

(c) Upon termination of Executive’s employment pursuant to Section 5(a)(iv), in
addition to the accrued but unpaid compensation and vacation pay through the
date of termination and any other benefits accrued to him under any Benefit
Plans outstanding at such time and the reimbursement of documented, unreimbursed
expenses incurred prior to such date, Executive shall be entitled to the
following severance benefits: (i) the greater of twelve (12) months’ Base Salary
at the then current rate or the remainder of the Base Salary due under this
Agreement, to be paid in equal bi-weekly installments, less withholding of all
applicable taxes, at such times he would have received them if there was no
termination; (ii) continued provision for a period of twelve (12) months after
the date of termination of the benefits under Benefit Plans extended from time
to time by the Company to its senior executives; and (iii) payment on a
pro-rated basis of any bonus or other payments earned in connection with any
bonus plan to which Executive was a participant as of the date of Executive’s
termination of employment.

 

(d) Upon termination of Executive’s employment pursuant to Section 5(a)(v), the
Company shall reimburse the documented, unreimbursed expenses incurred prior to
such date of termination and Executive shall be entitled to the following
severance benefits: accrued and unpaid Base Salary and vacation pay through the
date of termination, less withholding of

 

(e) applicable taxes. Executive shall have any conversion rights available under
the Company’s or Benefit Plans and as otherwise provided by law, including the
Comprehensive Omnibus Budget Reconciliation Act.

 

(f) Any payments required to be made hereunder by the Company to Executive shall
continue to Executive’s beneficiaries in the event of his death until paid in
full.

 

(g) Change of Control. Upon a Change of Control, all options issued to Executive
pursuant to Section 4(c) hereof shall be deemed fully vested as of the date of
the Change of Control. For purposes of this Agreement “Change of Control” means
the occurrence of any of the following events:

 

(i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), becomes the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing fifty percent (50%) or
more of the total voting power of the Company’s then outstanding voting
securities or fifty percent (50%) or more of the fair market value of the
Company;

 

6

 

 

(ii) Within a twelve month period, any “person” (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing thirty percent (30%) or more of the total
voting power of the Company’s then outstanding voting securities;

 

(iii) Within a twelve month period, less than a majority of the directors are
Incumbent Directors. For purposes of this Agreement, “Incumbent Directors” means
directors who (A) are directors of the Company as of the date hereof or (B) are
elected, or nominated for election, to the Board with the affirmative votes of a
majority of the Incumbent Directors at the time of such election or nomination;
or

 

(iv) The Company has sold all or substantially all of its assets to another
person or entity that is not a majority-owned subsidiary of the Company.

 

Notwithstanding the preceding, the above-listed events must satisfy the
requirements of Treasury Regulation Section 1.409A-3(i)(5) in order to be deemed
a Change of Control.

 

7. Vacations. Executive shall be entitled to a vacation of three (3) weeks per
year, during which period his salary shall be paid in full. Executive shall take
his vacation at such time or times as Executive and the Company shall determine
is mutually convenient. Any vacation not taken in one (1) year shall not accrue,
provided that if vacation is not taken due to the Company’s business
necessities, up to three (3) weeks’ vacation may carry over to the subsequent
year.

 

8. Covenant Not To Disclose, Compete or Solicit. Upon execution of this
Agreement, Executive and the Company shall re-affirm and enter into that certain
Non-Disclosure, Non-Competition and Non-Solicitation Agreement in the form
attached hereto as Exhibit A (“Non-Disclosure, Non-Competition and
Non-Solicitation Agreement”).

 

9. Section 409A.

 

(a) Notwithstanding anything to the contrary contained in this Agreement, if at
the time of Executive’s separation from service within the meaning of Section
409A of the Internal Revenue Code of 1986, as amended (the “Code”), the Company
determines that Executive is a “specified employee” within the meaning of
Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit
that Executive becomes entitled to under this Agreement on account of
Executive’s separation from service would be considered deferred compensation
subject to the twenty percent (20%) additional tax imposed pursuant to Section
409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i)
of the Code, such payment shall not be payable and such benefit shall not be
provided until the date that is the earlier of (i) six months and one day after
Executive’s separation from service, or (ii) Executive’s death (the “Six Month
Delay Rule”).

 

(b) For purposes of this Section 9, amounts payable under the Agreement should
not be considered a deferral of compensation subject to Section 409A to the
extent provided in Treasury Regulation Section 1.409A-1(b)(4) (i.e., short-term
deferrals), Treasury Regulation Section 1.409A-1(b)(9) (i.e., separation pay
plans, including the exception under subparagraph (iii)), and other applicable
provisions of Treasury Regulations Sections 1.409A-1 through A-6.

 

7

 

 

(c) To the extent that the Six Month Delay Rule applies to payments otherwise
payable on an installment basis, the first payment shall include a catch-up
payment covering amounts that would otherwise have been paid during the
six-month period but for the application of the Six Month Delay Rule, and the
balance of the installments shall be payable in accordance with their original
schedule.

 

(d) To the extent that the Six Month Delay Rule applies to the provision of
benefits (including, but not limited to, life insurance and medical insurance),
such benefit coverage shall nonetheless be provided to Executive during the
first six months following his separation from service (the “Six Month Period”),
provided that, during such Six-Month Period, Executive pays to the Company, on a
monthly basis in advance, an amount equal to the Monthly Cost (as defined below)
of such benefit coverage. The Company shall reimburse Executive for any such
payments made by Executive in a lump sum not later than thirty (30) days
following the sixth month anniversary of Executive’s separation from service.
For purposes of this subparagraph, “Monthly Cost” means the minimum dollar
amount which, if paid by Executive on a monthly basis in advance, results in
Executive not being required to recognize any federal income tax on receipt of
the benefit coverage during the Six Month Period.

 

(e) The Parties intend that this Agreement will be administered in accordance
with Section 409A of the Code. To the extent that any provision of this
Agreement is ambiguous as to its compliance with Section 409A of the Code, the
provision shall be read in such a manner so that all payments hereunder comply
with Section 409A of the Code. The Parties agree that this Agreement may be
amended, as reasonably requested by either Party, and as may be necessary to
fully comply with Section 409A of the Code and all related rules and regulations
in order to preserve the payments and benefits provided hereunder without
additional cost to either Party.

 

(f) The Company makes no representation or warranty and shall have no liability
to Executive or any other person if any provisions of this Agreement are
determined to constitute deferred compensation subject to Section 409A of the
Code but do not satisfy an exemption from, or the conditions of, such Section.

 

10. Insurance. The Company shall at all times during the Term and any Renewal
Term obtain and maintain director and officers liability insurance policies
covering Executive in his capacity as an executive officer and director, which
insurance shall include a standard “tail” provision, in such amounts, and with
such companies as shall be approved by both Executive and the Board.

 

11. Director Appointment; Nomination. The Board shall at all times during the
Term and any Renewal Term take all steps necessary to appoint Executive as a
member of the Board and to maintain such appointment. In addition, the Board
shall at all times during the Term and any Renewal Term take all steps necessary
to nominate Executive as a nominee for director for the purposes of any meeting
or consent of the shareholders conducted or taken during the Term or any Renewal
Term.

 

8

 

 

12. Indemnification Agreement. It shall be a condition to Executive’s
commencement of services under this Agreement that the Company and Executive
shall have entered into an Indemnification Agreement in the form of Exhibit B
hereto (the “Indemnification Agreement”).

 

13. Miscellaneous.

 

(a) Neither Executive nor the Company may assign or delegate any of their
respective rights under this Agreement without the express written consent of
the other. This Agreement constitutes and embodies the full and complete
understanding and agreement of the Parties with respect to Executive’s
employment by the Company, supersedes all prior understandings and agreements,
whether oral or written, between Executive and the Company, and shall not be
amended, modified or changed except by an instrument in writing executed by the
Party to be charged. The invalidity or partial invalidity of one or more
provisions of this Agreement shall not invalidate any other provision of this
Agreement. No waiver by either Party of any provision or condition to be
performed shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same time or any prior or subsequent time.

 

(b) This Agreement shall inure to the benefit of, be binding upon and
enforceable against, the Parties and their respective successors, heirs,
beneficiaries and permitted assigns.

 

(c) The headings contained in this Agreement are for convenience of reference
only and shall not affect in any way the meaning or interpretation of this
Agreement.

 

(d) All notices, requests, demands and other communications required or
permitted to be given hereunder shall be in writing and shall be deemed to have
been duly given when personally delivered, sent by registered or certified mail,
return receipt requested, postage prepaid, or by private overnight mail service
(e.g. Federal Express) to the Party at the address set forth above or to such
other address as either Party may hereafter give notice of in accordance with
the provisions hereof. Notices shall be deemed given on the sooner of the date
actually received or the third business day after sending.

 

(e) This Agreement shall be governed by and construed in accordance with the
internal laws of the State of without reference to principles of conflicts of
laws and each of the Parties irrevocably consents to the jurisdiction and venue
of the federal and state courts located in the State of .

 

(f) This Agreement supersedes, replaces and merges all previous agreements and
discussions relating to the same or similar subject matters between Executive
and Employer with respect to the subject matter of this Agreement, including
without limitation the Original Employment Agreement.

 

(g) This Agreement may be executed simultaneously in counterparts, each of which
shall be deemed an original, but all of which together shall constitute one of
the same instrument. The Parties have executed this Agreement as of the date set
forth above.

 

[-signature page follows-]

 

9

 

 

IN WITNESS WHEREOF, the Parties have caused this Employment Agreement to be duly
executed as of the date first indicated above.

 

  THE COMPANY

 

  WIZARD WORLD, INC.

 

  By: /s/ Gregg Suess     Greg Suess     Chairman of the Compensation Committee

 

  EXECUTIVE

 

  /s/ John Macaluso   John Macaluso

 

S-1

 

 

EXHIBIT A

 

NON-COMPETE, NON-SOLICITATION AND NON-DISCLOSURE AGREEMENT

 

See attached.

 

Exhibit A  

 

 

NON-COMPETE, NON-SOLICITATION AND NON-DISCLOSURE AGREEMENT

 

THIS NON-COMPETE, NON-SOLICITATION AND NON-DISCLOSURE AGREEMENT (“Agreement”)
dated as of September 16, 2014, by and between Wizard World, Inc., a Delaware
corporation with a principal place of business at 225 California Street, El
Segundo, California 90245 (“Employer”), and John Macaluso, an individual and
resident of the State of California with a business address c/o Wizard World,
Inc. 225 California Street, El Segundo, California 90245 (“Employee” and
together with Employer, the “Parties” and each, a “Party”).

 

WITNESSETH:

 

WHEREAS, Employee has been employed by Employer since March 19, 2012;

 

WHEREAS, Employee and Employer are entering into that certain Amended and
Restated Employment Agreement, dated as of the date of this Agreement;

 

WHEREAS, in connection with such employment, Employee has been and may be given
further access to, generate, or otherwise come into contact with certain
proprietary and/or confidential information of Employer or clients of Employer;
and

 

WHEREAS, Employee and Employer desire to prevent the dissemination, unauthorized
disclosure or misuse of such information.

 

NOW THEREFORE, the parties hereto mutually agree as follows:

 

1. Covenant Not to Solicit. During the period commencing on the date hereof and
ending upon the termination of Employee’s employment for any reason, Employee
shall not, directly or indirectly, for Employee’s benefit or the benefit of a
third party, (i) induce or attempt to induce any employees of Employer to leave
the employ of Employer or diminish his or her relationship or Employer or (ii)
solicit the business of any client or customer of Employer, or any client or
customer that could reasonably be expected to be a client or customer of
Employer, during Employee’s period of employment with the Company.

 

2. Covenant Not to Compete. Except for the activities set forth in Schedule I
hereto and as a passive investor in less than five percent (5%) of the equity
securities of a publicly held company, during the period commencing on the date
hereof and ending upon the termination of Employee’s employment for any reason,
Employee shall not engage in, own or control an interest in, or act as
principal, director or officer of, or consultant to, any firm or corporation (i)
engaged in a venture or business substantially similar to that of Employer or
(ii) which is in direct or indirect competition with Employer within the United
States of America, its territories and possessions.

 

3. Proprietary Information.

 

(a) For purposes of this Agreement, “Proprietary Information” shall mean any
information belonging to the business of Employer that has not previously been
publicly released by duly authorized representatives of Employer and shall
include (but shall not be limited to) information encompassed in all proposals,
marketing and sales plans, financial information, costs, pricing information,
computer programs (including source code, object code, algorithms and models),
customer information, customer lists, and all methods, concepts, know-how or
ideas and confidential information belonging to Employer and Employer’s
customers or clients. Employee agrees to regard and preserve as confidential all
Proprietary Information whether Employee has such Proprietary Information in
Employee’s memory or in writing or other physical form.

 

Exhibit A
A-1

 

 

(b) Notwithstanding the foregoing, “Proprietary Information” shall not include
information that (i) is disseminated to the public at no fault of Employee, (ii)
was obtained from a third party that did not have an obligation of
confidentiality to Employer, (iii) is already in the possession of Employee and
(iv) constitutes any information proposals, marketing and sales plans, financial
information, costs, pricing information, computer programs (including source
code, object code, algorithms and models), customer information, customer lists,
and all methods, concepts, know-how or ideas, created or generated by Employee
for which Employer has not been fully compensated.

 

(c) Employee will not, without written authority from Employer to do so,
directly or indirectly, disclose or use any Proprietary Information for
Employee’s benefit or purposes, nor disclose any Proprietary Information to
others, either during the term of Employee’s employment by Employer or
thereafter, except as required by the conditions of Employee’s employment by
Employer.

 

(d) No work or intellectual property created by Employee shall be deemed work
for hire and Employer shall only have the rights to such work or intellectual
property after fully compensating Employee for such work or intellectual
property.

 

4. Saving Provision. Employee expressly agrees that the covenants set forth in
this Agreement are being given to Employer in connection with the employment of
Employee by Employer and that such covenants are intended to protect Employer
against the competition by Employee, within the terms stated, to the fullest
extent deemed reasonable and permitted in law and equity. In the event that the
foregoing limitations upon the conduct of Employee are beyond those permitted by
law, such limitations, both as to time and geographical area, shall be, and be
deemed to be, reduced in scope and effect to the maximum extent permitted by
law.

 

5. Injunctive Relief. Employee acknowledges that (i) disclosure of any
Proprietary Information or breach of any of the non-competitive covenants or
agreements contained herein will give rise to irreparable injury to Employer or
clients of Employer that would be inadequately compensable in damages.
Accordingly, Employer, or where appropriate a client of Employer, may seek and
obtain injunctive relief against the breach or threatened breach of the
foregoing undertakings, in addition to any other legal remedies which may be
available. Employee further acknowledges and agrees that in the event of the
termination of employment with Employer, (ii) Employee’s experience and
capabilities are such that Employee can obtain employment in business activities
which are of a different or non-competing nature with his or her activities as
an employee of Employer and (iii) the enforcement of a remedy hereunder by way
of injunction shall not prevent Employee from earning a reasonable livelihood.
Employee further acknowledges and agrees that the covenants contained herein are
necessary for the protection of the Company’s legitimate business interests and
are reasonable in scope and content, and that Employee will, promptly upon the
request of Employer at any time, cause any subsequent employer to execute and
deliver to Employer a confidentiality and non-disclosure agreement in
substantially the form of Section 2 hereof and otherwise satisfactory to
Employer.

 

Exhibit A
A-2

 

 

6. Enforceability. The provisions of this Agreement shall be enforceable
notwithstanding the existence of any claim or cause of action of Employee
against Employer whether predicated on this Agreement or otherwise.

 

7. Term. This Agreement shall commence on the date hereof and shall terminate
upon the termination of Employee’s employment for any reason.

 

8. Governing Law. The Agreement shall be construed in accordance with the laws
of the State of New York and any dispute under this Agreement will only be
brought in the state and federal courts located in the State of New York.

 

9. General. This Agreement contains the entire agreement of the Parties relating
to the subject matter hereof. This Agreement may be modified only by an
instrument in writing signed by both Parties hereto. Any notice to be given
under this Agreement shall be sufficient if it is in writing and is sent by
certified or registered mail to Employee at his residence address as the same
appears on the books and records of Employer or to Employer at its principal
office, attention of the President, or otherwise as directed by Employer, from
time to time. Non-compliance with any one paragraph of this Agreement shall not
have an effect on the validity of any other part of this Agreement. The
provisions of this Agreement relating to confidentiality or non-competition
shall survive the termination of employment, however caused.

 

[-signature page follows-]

 

Exhibit A
A-3

 

 

IN WITNESS HEREOF, the undersigned execute this Agreement as of the date first
set forth above.

 

  EMPLOYER

 

  WIZARD WORLD, INC.

 

  By: /s/ Gregg Suess     Greg Suess     Chairman of the Compensation Committee

 

  EMPLOYEE

 

  /s/ John Macaluso   John Macaluso

 

Exhibit A
A-4