Document:

Prepared by MERRILL CORPORATION

CONFIDENTIALITY AND

NON-COMPETITION AGREEMENT

 

 

THIS

CONFIDENTIALITY AND NON-COMPETITION AGREEMENT (the “Agreement”)

has been entered into this ___ day of November 2000, by and between On Stage

Entertainment, Inc., (hereinafter referred to as “OSE” or the “Company”), and

Jeffrey Victor, an individual (hereinafter referred to as “VICTOR”).

 

In consideration of the

mutual promises and covenants between the parties in connection with VICTOR’s

employment agreement executed and dated November 1, 2000, (which is incorporated

herein by reference and referred to as the “Employment Agreement”), as well as

VICTOR’s future involvement with OSE as its Chief Operating Officer and Senior

Vice President, and for other good and valuable consideration, the parties

hereto agree as follows:

 

1.             CONFLICTING

ACTIVITIES.

 

1.1          Involvement

in Business Opportunities. 

VICTOR shall not, during the term of his Employment Agreement, be

engaged in any other business activity which is or may be competitive with the

business of the Company, without the prior written consent of the Company’s

Board of Directors; provided, however, that this restriction shall not be

construed as preventing VICTOR from being a director of, or investing his

personal assets in passive investments in, business entities which are not in

competition with the Company or any of its affiliates, or from pursuing

business opportunities as permitted by paragraph 1.2.

 

1.2          Development

of Business Opportunities. 

VICTOR hereby agrees to promote and develop all business opportunities

that come to his attention relating to current or reasonably anticipated future

business of the Company, in a manner consistent with the best interests of the

Company and with his duties under his Employment Agreement. Should VICTOR

discover a business opportunity which is or may reasonably be anticipated to be

related to the business of the Company, he shall first offer such opportunity

to the Company.  Should the Board of

Directors of the Company not exercise its right to pursue this business opportunity

within a reasonable period of time, not to exceed sixty (60) days, then VICTOR

may develop the business opportunity for himself, provided, however, that such

development may in no way conflict or interfere with the duties owed by VICTOR

to the Company under his Employment Agreement. 

Further, VICTOR may develop such business opportunities only on his own

time, and may not use any service, personnel, equipment, supplies, facility, or

trade secrets of the Company in their development.  As used herein, the term “business opportunity” shall not include

business opportunities involving investment in publicly traded stocks, bonds or

other securities, or similar passive investments.

 

2.             CONFIDENTIALITY

OF TRADE SECRETS AND OTHER MATERIALS.

 

2.1          Trade

Secrets.  VICTOR

agrees not to disclose to others, or take or use for his own purposes or the

purposes of others, during or after his employment, any trade secrets,

confidential information, knowledge, data or the like that VICTOR acquires

during his Employment Agreement and that is not otherwise in the public domain.

VICTOR agrees that these restrictions shall also apply to (a) information,

knowledge, trade secret, data or know-how belonging to third parties in the

Company’s possession; and (b) information, knowledge, trade secret, or data

received, originated, discovered or developed by VICTOR during the term of this

Agreement. VICTOR recognizes that this obligation applies not only to technical

information, but also to any business, financial or marketing information that

the Company treats as confidential.  Any

information of the Company which is not readily available to the public shall

be considered to be a trade secret unless the Company advises VICTOR otherwise.

 

2.2          Ownership

of Trade Secrets; Assignment of Rights. 

VICTOR hereby agrees that all know-how, documents,

reports, plans, proposals, marketing and sales plans, client lists, client

files and materials made by him or by the Company during the term of his

employment are the property of the Company and shall not be used by him in any

way adverse to the Company’s interests. VICTOR shall not deliver, reproduce or

in any way allow such documents or things to be delivered or used by any third

party without specific direction or consent of the Board of Directors of the

Company. VICTOR hereby assigns to the Company any rights which he or she may

have in any such trade secret or proprietary information.

VICTOR agrees that for a

period of two (2) years immediately following his termination (voluntary or

with cause) with the Company, he shall not interfere with the business of the

Company in any manner, including, without limitation, by inducing an employee

or associate to leave the Company, or by inducing a consultant or other

independent contractor to sever that person’s relationship with the Company, or

disrupting the Company’s relationships with customers, agents, representatives

or vendors or otherwise.

 

3.             UNFAIR

COMPETITION AFTER TERMINATION.  Because

of his employment by the Company, VICTOR will have access to trade secrets and

confidential information about the Company, its products, its customers and its

methods of doing business.  In the event

of the termination of the Employment Agreement for any reason, VICTOR agrees

that for a period of two (2) years after termination of his employment he will

not, directly or indirectly, compete with Company in the field of live

entertainment, provided the Company continues to pay VICTOR his Base Salary,

Bonus, Vacation and Health/Dental/Vision insurance benefits at such rates as

were in effect as of last date of VICTOR’s employment with the Company.  VICTOR understands and agrees that direct

competition means the design, development, production, promotion, presentation,

or sale of live entertainment shows competitive with those of the Company.  Indirect competition means the employment by

any competitor or third party in a role that involves VICTOR in the design,

development, production, promotion, or sale of live entertainment shows

competitive with those of the Company, and for whom VICTOR will perform the

same or similar function as he performs for the Company.  VICTOR further agrees that for a period of

two (2) years after termination of his employment, he will not directly or

indirectly disclose to any third person any confidential information or trade

secrets not otherwise in the public domain, and to which he gained knowledge

during the term of his employment, provided the Company continues to pay VICTOR

his Base Salary, Bonus, Vacation and Health/Dental/Vision insurance benefits at

such rates as were in effect as of last date of VICTOR’s employment with the

Company.

 

4.             INJUNCTIVE

RELIEF.  The

Company and VICTOR hereby acknowledge and agree that any default under Sections

1 through 3, above, will cause damage to the Company in an amount which is

difficult, if not impossible, to ascertain. 

Accordingly, in addition to any other relief to which the Company may be

entitled, the Company shall be entitled to such injunctive relief as may be

ordered by any court of competent jurisdiction including, but not limited to,

an injunction restraining any violation of the above named Sections, and

without proof of actual damages

 

5.             ATTORNEY’S

FEES.  If any

party to this Agreement breaches any of the terms of this Agreement, then that

party shall pay to the non-defaulting party all of the non-defaulting party’s

costs and expenses, including attorney’s fees, incurred by that party in

enforcing the terms of this Agreement.

 

6.             MEDIATION/ARBITRATION.  If a dispute arises out of

or relates to this Agreement, the parties agree first to try in good faith to

settle the dispute by mediation under the commercial mediation rules of the

American Arbitration Association, before resorting to arbitration. Thereafter,

any remaining unresolved controversy or claim arising out of or relating to

this Agreement shall be settled by arbitration in Clark County, Nevada, in

accordance with commercial arbitration rules of the American Arbitration

Association, and judgment upon the award rendered by the arbitrator may be

entered in any court having jurisdiction thereof.  The prevailing party in any arbitration proceeding, as determined

by the arbitrator, shall be entitled to an award of reasonable attorney’s fees

and the fees and costs arising out of the arbitration proceedings, including,

but not limited to the arbitration’s fees and the American Arbitration

Association’s administrative fee.  The

parties further agree that the arbitrator, or such other person designated for

the purpose by the American Arbitration Association shall have jurisdiction

over all matters involving provisional remedies just as any court of competent

jurisdiction would, including but not limited to, the imposition of injunctive

relief to protect trade secrets and confidential information.

 

7.             GOVERNING

LAW.  This

Agreement shall be subject to and governed by the laws of the State of Nevada.

 

 

	

   

  	

   

  	

   

  	

   

  
	

  JEFFREY VICTOR, an individual

  	

   

  	

  DATEPrepared by MERRILL CORPORATION

Exhibit 10.5

Forms of Addenda to Executive Termination Benefits Agreements

The Company has entered into Executive Termination

Benefits Agreements with its Named Executive Officers and certain other senior

executives.  Each of the Executive

Termination Benefits Agreements is accompanied by an Addendum that describes

the benefits that would be provided to the executive. The form of the Executive

Termination Benefits Agreements, including the standard form of Addendum, was

filed as Exhibit 10.4 to the Company's report on Form 10-Q for the period ended

June 30, 2001.

There are two versions of the Addendum

which apply to the Named Executive Officers. 

The versions differ principally in the multiple of annual compensation

that would be payable to the executive under Section 3 of the applicable

Addendum.  The addenda for William J.

Hannigan, Jeffery M. Jackson and Eric J. Speck provide for 3 years

compensation.  The addendum for Michael W.

Nelson provides for 2 years compensation. 

The forms of these addenda are attached.

 

ADDENDUM TO EXECUTIVE

TERMINATION BENEFITS AGREEMENTS

 

	

  1.

  	

   

  	

  Continuation

  Period pursuant to

  Subparagraph 1(d) of the Executive Termination Benefits Agreement shall mean

  “the period of time beginning on the Termination Date and ending thirty-six

  (36) months thereafter.”

  
	

   

  	

   

  	

   

  
	

  2.

  	

   

  	

  The

  following language shall be added as Subparagraph 2(a)(iv) of the Executive

  Termination Benefits Agreement:

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  by

  the Executive within the thirty (30) day period immediately following the

  first anniversary of a Change in Control.

  
	

   

  	

   

  	

   

  
	

  3.

  	

   

  	

  The

  following language shall be added as Subparagraph 4(a) of the Executive

  Termination Benefits Agreement:

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  The

  Company will pay to the Executive the sum of (i) three (3) times the greater

  of (A) the Executive’s effective annual base salary at the Termination Date

  or (B) the Executive’s effective annual base salary immediately prior to the

  Change in Control, plus (ii) three (3) times the greater of (X) the highest

  annual bonus awarded to the Executive under the Company’s Variable

  Compensation Plan or any other bonus plan (whether paid currently or on a

  deferred basis) with respect to any twelve (12) consecutive month period

  during the last three (3) fiscal years ending prior to the Termination Date

  or (Y) the highest target bonus rate applicable to the Executive for any

  period during such prior three (3) year period, multiplied by the applicable

  annual base salary determined under clause (i) of this Section 4(a); the

  resulting amount to be paid in a lump sum on the first day of the month

  following the Termination Date.

  
	

   

  	

   

  	

   

  
	

  4.

  	

   

  	

  The

  following language shall be added following the last sentence of Subparagraph

  4(f)(iii) of the Executive Termination Benefits Agreement:

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  Notwithstanding

  anything in Section 4(f)(ii) or (iii) (or elsewhere) to the contrary, all

  equity awards shall vest upon voluntary termination of the Executive during

  the thirty (30) day period immediately following the first anniversary of the

  Change in Control.

  

 

 

	

  5.

  	

   

  	

  The

  following language shall be added as Subparagraph 4(j) of the Executive

  Termination Benefits Agreement:

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  Travel

  Privileges. The Company will

  purchase or otherwise make available to the Executive personal air travel on

  American Airlines and American Eagle (A) under terms and conditions no less

  favorable than those that did apply or would have applied to the Executive as

  an “Eligible Employee” under the Travel Privileges Agreement between the

  Company and American Airlines, Inc. (“American”) dated July 1, 1996, as

  amended, including any successor agreement (“Travel Agreement”) if the

  Executive’s employment with the Company had continued; and (B) at an after

  tax cost to the Executive equal to the after tax cost the Executive would

  have paid for personal air travel using the travel privileges as an “Eligible

  Employee” under the Travel Agreement if the Executive’s employment with the

  Company had continued. The Company will provide personal air travel pursuant

  until the earlier to occur of: (A) the expiration of the Travel Agreement

  (currently scheduled for June 30, 2008) or (B) a termination of the Travel

  Agreement by American other than as a consequence of the Change in Control;

  except that if before such an occurrence the Executive reaches (w) fifty-five

  (55) years of age with five (5) years of service if hired on or before July

  31, 1996, or (x) fifty-five (55) years of age with ten (10) years of service

  if hired after July 31, 1996, or (y) fifty (50) years of age with ten (10)

  years of service, or (z) fifty (50) years of age with fifteen (15) years of

  service, then the Company will purchase or otherwise make available to the

  Executive, immediately if the Executive qualifies under the preceding clauses

  (w) or (x), or upon the Executive reaching sixty-two (62) years of age if the

  Executive qualifies under the preceding clause (y), or upon the Executive

  reaching fifty-five (55) years of age if the Executive qualifies under the

  preceding clause (z), personal air travel on American Airlines and American

  Eagle (a) under terms and conditions no less favorable than those that would

  have applied to the Executive as an “Eligible Retiree” under the Travel

  Agreement if the Executive had retired from the Company; and (b) at an after

  tax cost to the Executive equal to the after tax cost the Executive would

  have paid for personal air travel using the travel privileges available as an

  “Eligible Retiree’ under the Travel Agreement if the Executive had retired

  from the Company. If the Travel Agreement is terminated by American due to

  the Change in Control, the Company will provide the personal air travel

  described in this Section (4)(j) without regard to any termination of the

  Travel Agreement.

  

 

	

   

  	

  Dated:  August 8, 2001

  
	

   

  	

   

  
	

   

  	

  SABRE

  HOLDINGS CORPORATION

  
	

   

  	

   

  
	

   

  	

  By 

  	

   

  
	

   

  	

   

  	

  James F. Brashear

  
	

   

  	

   

  	

  Corporate Secretary

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  SABRE INC.

  
	

   

  	

   

  	

   

  
	

   

  	

  By 

  	

   

  
	

   

  	

   

  	

  James F. Brashear

  
	

   

  	

   

  	

  Senior Vice President,

  Deputy General Counsel and Corporate Secretary

  
	

   

  	

   

  	

   

  
	

   

  	

  [Executive]

  
	

   

  	

   

  
	

   

  	

  Signed:

  	

   

  
				

 

 

ADDENDUM TO EXECUTIVE

TERMINATION BENEFITS AGREEMENTS

 

	

  1.

  	

   

  	

  Continuation

  Period pursuant to

  Subparagraph 1(d) of the Executive Termination Benefits Agreement shall mean

  “the period of time beginning on the Termination Date and ending twenty-four

  (24) months thereafter.”

  
	

   

  	

   

  	

   

  
	

  2.

  	

   

  	

  The

  following language shall be added as Subparagraph 4(a) of the Executive

  Termination Benefits Agreement:

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  The

  Company will pay to the Executive the sum of (i) two (2) times the greater of

  (A) the Executive’s effective annual base salary at the Termination Date or

  (B) the Executive’s effective annual base salary immediately prior to the

  Change in Control, plus (ii) two (2) times the greater of (X) the highest

  annual bonus awarded to the Executive under the Company’s Variable

  Compensation Plan or any other bonus plan (whether paid currently or on a

  deferred basis) with respect to any twelve (12) consecutive month period

  during the last two (2) fiscal years ending prior to the Termination Date or

  (Y) the highest target bonus rate applicable to the Executive for any period

  during such prior two (2) year period, multiplied by the applicable annual

  base salary determined under clause (i) of this Section 4(a); the resulting

  amount to be paid in a lump sum on the first day of the month following the

  Termination Date.

  

 

 

	

  3.

  	

   

  	

  The

  following language shall be added as Subparagraph 4(j) of the Executive

  Termination Benefits Agreement:

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  Travel

  Privileges. The Company will

  purchase or otherwise make available to the Executive personal air travel on

  American Airlines and American Eagle (A) under terms and conditions no less

  favorable than those that did apply or would have applied to the Executive as

  an “Eligible Employee” under the Travel Privileges Agreement between the

  Company and American Airlines, Inc. (“American”) dated July 1, 1996, as

  amended, including any successor agreement (“Travel Agreement”) if the

  Executive’s employment with the Company had continued; and (B) at an after

  tax cost to the Executive equal to the after tax cost the Executive would

  have paid for personal air travel using the travel privileges as an “Eligible

  Employee” under the Travel Agreement if the Executive’s employment with the

  Company had continued. The Company will provide personal air travel pursuant

  until the earlier to occur of: (A) the expiration of the Travel Agreement

  (currently scheduled for June 30, 2008) or (B) a termination of the Travel

  Agreement by American other than as a consequence of the Change in Control;

  except that if before such an occurrence the Executive reaches (w) fifty-five

  (55) years of age with five (5) years of service if hired on or before July

  31, 1996, or (x) fifty-five (55) years of age with ten (10) years of service

  if hired after July 31, 1996, or (y) fifty (50) years of age with ten (10)

  years of service, or (z) fifty (50) years of age with fifteen (15) years of

  service, then the Company will purchase or otherwise make available to the

  Executive, immediately if the Executive qualifies under the preceding clauses

  (w) or (x), or upon the Executive reaching sixty-two (62) years of age if the

  Executive qualifies under the preceding clause (y), or upon the Executive

  reaching fifty-five (55) years of age if the Executive qualifies under the

  preceding clause (z), personal air travel on American Airlines and American

  Eagle (a) under terms and conditions no less favorable than those that would

  have applied to the Executive as an “Eligible Retiree” under the Travel

  Agreement if the Executive had retired from the Company; and (b) at an after

  tax cost to the Executive equal to the after tax cost the Executive would

  have paid for personal air travel using the travel privileges available as an

  “Eligible Retiree’ under the Travel Agreement if the Executive had retired

  from the Company. If the Travel Agreement is terminated by American due to

  the Change in Control, the Company will provide the personal air travel

  described in this Section (4)(j) without regard to any termination of the

  Travel Agreement.

  

 

	

   

   

  	

  Dated:  August 8, 2001

  
	

   

  	

   

  
	

   

  	

  SABRE

  HOLDINGS CORPORATION

  
	

   

  	

   

  
	

   

  	

  By 

  	

   

  
	

   

  	

   

  	

  James F. Brashear

  
	

   

  	

   

  	

  Corporate Secretary

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  SABRE INC.

  
	

   

  	

   

  	

   

  
	

   

  	

  By 

  	

   

  
	

   

  	

   

  	

  James F. Brashear

  
	

   

  	

   

  	

  Senior Vice President,

  Deputy General Counsel and Corporate Secretary

  
	

   

  	

   

  	

   

  
	

   

  	

  [Executive]

  
	

   

  	

   

  
	

   

  	

  Signed:

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