MEDIA ARTS GROUP, INC.

Exhibit 10.48

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT is entered into as of June 19, 2001, by and between
MEDIA ARTS GROUP, INC., a Delaware corporation (the “Employer” or the
“Company”), and ANTHONY THOMOPOULOS, of 1280 Canyon Road, Los Angeles, CA 90077
(the “Employee”).

 

RECITALS

 

A. Employer is the holding company of various wholly owned subsidiaries which
are engaged in the business of the creation, printing, reproduction, marketing,
production, and selling of various forms of artwork, including, without
limitation, paintings, prints, lithographs, posters, as well as licensing and
wholesale distribution of plates, figurines, and other two- and
three-dimensional artwork.  Employer is also engaged in significant growth which
may lead to the acquisition and development of related and other businesses.

 

B. The Board of Directors of the Employer (the “Board”) has approved and
authorized the entry of this Agreement with the Employee.

 

C. The parties of this Agreement desire to enter into this Agreement setting
forth the terms and conditions for the employment relationship of the Employee
with the Employer.

 

NOW, THEREFORE, IN CONSIDERATION OF THE COVENANTS, CONDITIONS AND PROMISES OF
THE PARTIES SET FORTH BELOW, Employer and Employee agree as follows:

 

1)    Employment.  The Employee is employed as Interim Chief Executive Officer
as of the date of this Agreement and through and until the termination of this
Agreement, as hereinafter defined, with the duties and responsibilities and on
the terms and conditions hereinafter set forth.

 

2)    Responsibilities and Duties of Employee.  It is agreed that Employee is
employed on a full-time basis (approximately three to four days per week), which
is defined to mean Employee’s entire productive time, ability and attention.  In
his capacity as Interim Chief Executive Officer, Employee shall be primarily
responsible for, and shall personally perform or personally supervise, the
strategic management and functions of the Company.  In addition, Employee shall
be responsible for the search and retention of a Chief Executive Officer for the
Company.

 

In addition to the aforementioned responsibilities and duties, Employee shall
perform such other duties and responsibilities as the Board shall designate as
are not inconsistent with the Employee’s position with the Employer, including
the performance of duties with respect to any subsidiaries of the Employer.

 

Employee shall at times perform the duties set forth herein faithfully,
industriously, and to the best of the Employee’s ability, experience and
talent.  Employee shall be responsible to the Board in regard to all matters
unless otherwise mutually agreed to by the parties.

 

3)    Location of the Employee’s Work.  The Employee shall be based in the
principal executive offices of the Employer in Morgan Hill, California, or in
any city which the principal executive offices of the Employer may relocate. 
The Employee shall be provided with appropriate temporary housing or lodging
expenses including travel expenses to and from primary residence and corporate
office during the term of his employment, along with appropriate transportation
in the form of an automobile.

 

4)    Duration of Employment.  The Employer agrees to employ Employee in the
capacity set for the above for the period of time commencing as of the date
hereof and ending 90 days later, on September 17, 2001.  However, should
Employee not find and the Company not be able to retain a suitable Chief
Executive Officer on or before September 17, 2001, then Employee shall remain
employed by the Company for up to an additional 90-day period, until December
16, 2001.

 

5)    Compensation to Employee.

 

a)     Salary.  The Employer agrees to pay the Employee total compensation for
the initial 90-day period in the amount of $250,000.00.  Employee shall not be
entitled to receive bonus payments or profit-sharing payments of any kind during
the period of time Employee is employed hereunder.  If Employee is successful in
identifying a Chief Executive Officer during the first 90-day period, and should
the Company retain such Chief Executive Officer prior to the end of the first
90-day period, then Employee shall still be entitled to receive the full
$250,000.00 compensation for the first 90-day period.  Should the employment of
Employee extend into the second 90-day period, then Employee shall be
compensated through the issuance of stock options, priced at $1.00 per share. 
Such options shall be granted to Employee at the rate of 50,000 per 30-day
period and shall be immediately exercisable at the conclusion of each 30-day
period, or at the termination of Employee’s employment, whichever shall occur
first.  Should Employee’s employment during the second 90-day period terminate
prior to the end of any 30-day period therein, then the entire 50,000 options
shall be granted at that time.

 

Should the employment of the employee be terminated prior to the first 90 days
without cause (see paragraph 7a) the employee shall be entitled to receive the
full $250,000 compensation for the first 90-day period.

 

The salary under this Paragraph (a) of this Section 5 shall be payable according
to Employer’s normal payroll practices and shall be subject to standard federal
and California tax withholding rules.

 

b)     Health Care, Disability, and Life Insurance Benefits.  The Employer
agrees to provide medical insurance coverage under the Employer’s group medical
insurance plan for the Employee and his dependents, at no cost to the Employee
for such coverage of the Employee and his dependents.  The Employer agrees to
pay the premiums on the life and disability insurance policies which are in
effect as of the date hereof and under which the Employee receives life
insurance and disability insurance coverage.

 

6)    Expenses Incurred by Employee.  In General.  In addition to the
compensation structure set forth in Section 5, the Employer shall pay all direct
out-of-pocket expenses incurred by the Employee in connection with the
performance of his duties set forth herein including, but not limited to,
travel, lodging and long distance telephone expenses.  The Employee shall
include in any request for reimbursement for such expenses a detailed account
with receipts of all expenses incurred by the Employee, and a detailed account
of the business relating to those expenses, in connection with the performance
of his duties as described in this Agreement.

 

 

7)    Termination.

 

a)     Cause.  Subject to the notice provisions set forth below, the Employer
may terminate the Employee’s employment for “Cause” at any time.  “Cause” shall
mean termination upon (1) the willful failure by the Employee to substantially
perform his duties with the Employer (other than any such failure resulting from
his incapacity due to physical or mental illness), after a written demand for
substantial performance is delivered to him by the Board, which demand
specifically identifies the manner in which the Board believes that he has not
substantially performed his duties or (2) the willful engaging by the Employee
in conduct which is demonstrably and materially injurious to the Employer,
monetarily or otherwise.  For purposes of this paragraph (a) of this Section 7,
no act, or failure to act, on the Employee’s part shall be deemed “willful”
unless done, or omitted to be done, by him not in good faith and without the
reasonable belief that this action or omission was in the best interest of the
Employer.  Notwithstanding the foregoing, the Employee shall not be deemed to
have been terminated for Cause unless and until there shall have been delivered
to him a copy of a resolution duly adopted by the affirmative vote of not less
than two-thirds (2/3) of the entire membership of the Board at a meeting of such
Board (after reasonable notice to him and an opportunity for him, together with
his counsel, to be heard before such Board), finding that he has engaged in the
conduct set forth above in this paragraph (a) and specifying the particulars
thereof in detail.

 

b)     Notice of Termination.  Any termination of the Employee’s employment by
the Employer or by the Employee shall be communicated by written Notice of
Termination to the other party hereto in accordance with Section10.  “Notice of
Termination” shall mean a notice that shall indicate the specific termination
provision in the Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for the termination of
the Employee’s employment under the provision so indicated.

 

c)     Date of Termination.  “Date of Termination” shall mean (1) if the
Employee’s employment is terminated by his death, the date of his death; (2) if
the Employee’s employment is terminated for Disability, thirty (30) days after
Notice of Termination is given (provided that he shall not have returned to the
full-time performance of his duties during such thirty (30) day period); (3) if
the Employee’s employment is terminated for Cause, the date specified in the
Notice of Termination (which shall not be less than thirty (30) days from the
date of Notice of Termination is given), and (4) if the Employee’s employment is
terminated for any other reason, the date specified in the Notice of
Termination.

 

8)    No Assignments.  This Agreement is personal to each of the parties
hereto.  No party may assign or delegate any rights or obligations hereunder
without first obtaining the written consent of all of the other parties hereto,
except that this Agreement shall be binding upon and inure to the benefit of any
successor corporation to the Employer.

 

a)     This Agreement shall inure to the benefit of and be enforceable by the
Employee and his personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees, and legatees.  If the Employee should
die while any amount would still be payable to him hereunder had he continued to
live, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to his devisee, legatee or other
designee, if there is no such designee, to his estate.

 

9)    Noncompetition.

 

a)     General.  The Employee agrees that while this Agreement is in effect, he
will not, directly or indirectly, without the prior written consent of the
Employer, provide consultative service with or without pay, own, manage,
operate, join, control, participate in, or be connected as a stockholder,
partner, or otherwise with any business, individual, partner, firm, corporation,
or other entity which is then in competition with the Employer or any subsidiary
or affiliate of the Employer in violation of this Agreement and that the
Employer would by reason of such competition be entitled to injunctive relief in
a court of appropriate jurisdiction, and the Employee further consents and
stipulates to the entry of such injunctive relief in such a court prohibiting
the Employee from competing with the Employer or any subsidiary or affiliate of
the Employer, in the areas set forth above, in violation of this Agreement.

 

 

b)     Right to Company Materials.  The Employee agrees that all styles,
designs, lists, materials, books, files, reports, correspondence, records, and
other documents (“Company Material”) used, prepared, or made available to the
Employee, shall be and shall remain the property of the Employer, its
subsidiary, or its affiliate, as the case may be.  Upon termination of
employment of the expiration of the Agreement, all Company Materials shall be
returned immediately to the Employer, its subsidiary, or its affiliate, as the
case may be; provided, however, that the Employee shall be entitled to make and
retain any copies thereof with respect to matters involving the Employee.

 

c)     Antisolicitation.  The Employee promises and agrees that while this
Agreement continues in effect, he will not influence or attempt to influence
customers or suppliers of the Employer or any of its present or future
subsidiaries or affiliates, either directly or indirectly, to divert their
business to any individual, partnership, firm, corporation, or other entity then
in competition with the business of the Employer, or any subsidiary or affiliate
of the Employer.

 

d)     Soliciting Employees.  The Employee promises and agrees that while this
Agreement continues in effect, he will not directly or indirectly solicit any of
the employees of the Employer, its subsidiaries or its affiliates to work for or
invest in, as the case may be, any business, individual, partnership, firm,
corporation, or other entity then in competition with the business of the
Employer or any subsidiary or affiliate of the Employer.

 

e)     Restriction on Use or Disclosure of Trade Secrets.  It is expressly
understood that the Employee may be dealing with trade secrets of the Employer,
its subsidiaries and its affiliates, including but not limited to information,
system(s), inventions, and processes, all of a confidential nature, that concern
the operations of the Employer, its subsidiaries or affiliates and that are the
Employer’s property and are used in the course of the Employer’s business or
that of its subsidiaries or affiliates.  The Employee promises and agrees that
he will not disclose to anyone, directly, or indirectly, either while this
Agreement is in effect or at any time thereafter, any of such trade secrets, or
use them other than in the course of his employment.  The Employee acknowledges
that the Employer may use all remedies, including injunctive relief, in order to
enforce the provisions of this paragraph (e).

 

10)  Notice.  For the purpose of this Agreement, notices provided for in this
Agreement shall be in writing and shall be deemed to have been duly given when
delivered or mailed by United States certified or registered mail, return
receipt requested, postage prepaid, addressed to the respective addresses set
forth below, or to such other address as any party may have furnished to the
other in writing in accordance herewith, except that notice of a change of
address shall be effective only upon actual receipt:

 

Employer:                                                                                                            
MEDIA ARTS GROUP, INC.

                                                                                                                              
900 Lightpost Way

                                                                                                                              
Morgan Hill, CA 95037

                                                                                                                              
Attn:  General Counsel

 

Employee:                                                                                                           
ANTHONY THOMOPOULOS

                                                                                                                              
1280 Stone Canyon Road

                                                                                                                              
Los Angeles, CA 90077

 

 

11)  Indemnification.  If the Employee is made or is threatened to be made a
party to any threatened, pending, or completed action, suit or proceeding,
whether civil, criminal administrative or investigative, by reason of the fact
that he is or was an officer of the Employer, or is or was an officer of the
Employer serving at the request of the Employer as a director or officer,
employee or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, then the Employer shall indemnify the
Employee against expenses (including attorneys’ fees), judgements, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith, as such term is
defined in the Bylaws of the Employer, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful;
provided, however, that with respect to actions, suit or proceedings by or in
the right of the Employer, the Employer shall not indemnify the Employee in
respect of any claim, issue or matter as to such which Employee shall have been
adjudged to be liable to the Employer unless and only to the extent that the
court in which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the circumstances
of the case, such Employee is fairly and reasonably entitled to indemnity for
such expenses which the court shall deem proper.

 

The termination of any action, suit or proceeding by judgement, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself create a presumption that the person did not act in good
faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Employer, and, with respect to any criminal action or
proceeding, any reasonable cause to believe that his conduct is unlawful.

 

12)  Entire Agreement.  This Agreement represents the entire agreements of
parties hereto.  No agreements or representation, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by any of the
parties which are not expressly set forth in this Agreement.

 

13)  Amendments, Additions, Modifications, Waiver or Discharge.  No amendments
or additions to this Agreement shall be binding unless in writing and signed by
all parties hereto.  No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing
and signed by all parties hereto.

 

14)  Governing Law.  This Agreement shall be governed by, construed and enforced
in accordance with the laws of the State of California and any applicable
federal laws.

 

15)  Captions and Section Numbers.  The captions and numbers to the sections and
paragraphs of this Agreement are inserted for convenience only and shall not
affect the construction or interpretation hereto.

 

16)  Triplicate Originals; Counterparts.  This Agreement and all amendments
shall be fully executed in triplicate and each triplicate shall constitute an
original of the same instrument.  This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.

 

17)  Arbitration.  Any controversy or claim arising out of or relating to this
Agreement shall be settled exclusively by arbitration, conducted before a panel
of three (3) arbitrators in Morgan Hill, California in accordance with the rules
or the American Arbitration Association then in effect.  Judgment may be entered
on the arbitrator’s award in any court having jurisdiction.

 

18)  Severability.  The provisions of this Agreement shall be deemed severable
and the invalidity or unenforceability of any provision shall not affect the
validity or enforceability of the other provisions hereof.

 

 

19)  Numbers.  Unless the context clearly indicates otherwise, words used herein
in the singular include the plural and words in the plural include the singular.

 

20)  Gender.  The use of feminine, masculine, or neuter pronoun shall not be
restrictive as to gender and shall be interpreted in all cases as the context
may require.

 

21)  Representations of Employee.  The Employee represents that he is not under
contract of any kind with any entity or business which would prohibit him from
entering into this Agreement.  The Employee further represents that he is
entirely free to enter into this Agreement and that he neither has not will
enter into any agreement or other obligation while this Agreement is in effect
which might conflict with this Agreement or interfere or conflict with any of
the terms thereof.

 

22)  Representation of Employer.  The Employer represents that it is a
corporation in good standing by and under the laws of the State of Delaware and
that its president has the authority to properly execute this Agreement.

 

IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement
on the date first indicated above.

 

 

 

MEDIA ARTS GROUP, INC.

 

 

 

 

 

 

By:

 /s/ Herb Montgomery

 

 

 

Herb Montgomery

 

 

Senior Vice President, Chief Financial Officer

 

 

 

 

 

 

/s/ Anthony D. Thomopoulos

 

 

 

Anthony Thomopoulos

 

 

Employee

 

 

 

/s/ Timothy S. Guster

 

 

Timothy Guster

 

 

Senior Vice President, General Counsel