Exhibit 10.05
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") is made and entered into
as of the 28th day of May, 1999 ("Effective Date"), by and between P. Xxxx
Xxxxxxx ("Xxxxxxx") and Hispano Television Ventures, Inc., a Texas
corporation ("Company").
RECITALS
WHEREAS, pursuant to that certain Loan Agreement dated as of this date
(the "Loan Agreement"), by and among the Company and the Investors named
therein, and joined in by Woodcrest Capital, L.L.C., Xxxxxx X. Xxxxxxxx,
Xxxxxxx and Xxxxxxxx 0. Xxxxxxx, the Investors have made a loan to the
Company; and
WHEREAS, Xxxxxxx has been employed by the Company since its formation
and the Company and the Investors desire the continued services of Xxxxxxx as
an employee of the Company; and
WHEREAS, Xxxxxxx desires to serve in the employment of the Company on
the terms and conditions set forth below;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth in this Agreement, the parties hereto agree as follows:
1. Employment. The Company hereby employs Xxxxxxx to serve in the
capacity of Chief Executive Officer of the Company, and Xxxxxxx hereby
accepts such employment, upon the terms and conditions set forth in this
Agreement.
2. Term. The term of this Agreement (the "Term") shall commence on
the Effective Date and shall terminate on the fifth anniversary of such date,
subject to earlier termination as hereinafter provided. Thereafter, this
Agreement shall continue on a year-to-year basis and can be terminated by
either party on 60 days prior written notice.
3. Duties. During the Term, Xxxxxxx shall perform such duties for
the Company which are customarily performed by one holding the position of
Chief Executive Officer in other, same or similar businesses or enterprises
and such other consistent duties and responsibilities as established from
time to time by the board of directors of the Company. Xxxxxxx agrees that
he will devote his entire time, attention and energies to the business of the
Company and its subsidiaries and affiliates, if applicable, and to the
performance of his duties hereunder which shall include such executive duties
on behalf of the Company as from time to time may be assigned to him by the
board of directors of the Company. In the performance of such duties,
Xxxxxxx shall report directly to the board of directors of the Company and
will at all times be subject to the direction of the board of directors of
the Company.
4. Compensation.
(a) Base Compensation. During the Term of this Agreement, the
Company shall pay to Xxxxxxx a salary in the amount of $60,000 per annum.
Such annual salary shall be payable during the Term in substantially equal
installments on the last day of each and every month in accordance with the
Company's standard payroll policy or in such other installments as the
parties may mutually agree. Such annual salary shall be in addition to any
bonuses (cash or otherwise), insurance, pension, profit sharing, stock
options, retirement and other fringe benefits which may be provided from time
to time in the discretion of the Company. Such fringe benefits shall be
subject to such rules and procedures as are from time to time specified by
the Company except to the extent to which such rules and procedures are
inconsistent with the provisions of this Agreement, in which case the
provisions of this Agreement shall be controlling.
(b) Management Bonus. In addition to the base compensation provided
for in Section 4(a) above, in the event the Company sustains the levels of total
revenue and net profit margin specified below for a period of three consecutive
months, a Management Bonus in the amount indicated shall be paid to Xxxxxxx each
month thereafter:
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Targeted Amounts Management Bonus
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$200,000 per month in total revenue and Management Bonus in the total amount
a Company net profit margin of 40% of $1,000 per month
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$300,000 per month in total revenue and Management Bonus in the total amount
a Company net profit margin of 40% of $2,500 per month
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$500,000 per month in total revenue and Management Bonus in the total amount
a Company net profit margin of 40% of $5,000 per month
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Xxxxxxx shall be entitled to receive a Management Bonus only if and as
the Company meets the above referenced total revenue and net profit margin
targets (the "Targeted Amounts") and any Management Bonus payment which
commences shall be discontinued if the Company fails to sustain the
applicable Targeted Amounts in any month. Following a discontinuance of a
Management Bonus payment, resumption of the Management Bonus payment will
only occur following achievement of the applicable Targeted Amounts for a
period of three consecutive months following the discontinuance.
Failure of the Company to sustain the Targeted Amounts qualifying
Xxxxxxx for a $5,000 per month Management Bonus will not preclude Xxxxxxx
from receiving a $2,500 per month Management Bonus or a $ 1,000 per month
Management Bonus if the applicable Targeted Amounts are sustained by the
Company; provided, however, Management Bonuses are not cumulative and receipt
of a Management Bonus for higher Targeted Amounts shall preclude receipt of a
Management Bonus for lower Targeted Amounts. For purposes of this Section
4(b), total revenue and net profit margin shall be determined by reference to
the Company's regularly prepared monthly financial statements and the
determination as to Xxxxxxx'x entitlement to any Management Bonus by the
Company's board of directors shall be final and conclusive.
(c) Expenses; Benefits. During the Term, Xxxxxxx shall be entitled
to an appropriate office, secretarial and clerical staff, as well as
reimbursement, upon proper accounting, of reasonable expenses and disbursements
incurred by Xxxxxxx in the course of Xxxxxxx'x duties in accordance with the
Company's then existing reimbursement policies. Except to the extent that
greater benefits are provided in this Agreement, Xxxxxxx shall further be
entitled to fully participate in all other benefits made available or applicable
to other employees of the Company. The receipt of such benefits by Xxxxxxx shall
be subject to the Company's eligibility and enrollment requirements pertaining
to such benefit programs.
(d) Vacations. During the Term, Xxxxxxx shall be entitled to paid
vacations and personal leaves of absence and leaves to attend professional
conventions and meetings as indicated in the Company's policy manual.
5. Confidentiality and Competitive Activities.
(a) Confidentiality. In view of the fact that Xxxxxxx'x work as an
executive of the Company will bring him into close contact with many
confidential affairs of the Company and of its subsidiaries and affiliates,
including matters of a business nature such as information about costs, profits,
markets, sales, trade secrets, business ideas, customer lists, plans for future
developments, and information of any other kind not known within the Company's
industry generally (hereinafter, collectively, "Confidential Matters"), Xxxxxxx
agrees:
(i) To keep secret all Confidential Matters of the Company and of
any subsidiaries and affiliates of the Company, and not to disclose
them to anyone outside of the Company or its subsidiaries or
affiliates, or otherwise use them or use his knowledge of them for his
own benefit, including, without limitation, use of the trade names or
trademarks of the Company, either during or after the Term, except
with the Company's prior written consent; and
(ii) To deliver promptly to the Company at the termination of the
Term, or at any time the Company may request, all memoranda, notices,
records, reports and other documents (and all copies thereto) relating
to the business of the Company or any of its subsidiaries or
affiliates, including, but not limited to, Confidential Matters, which
he may then possess or have under his control.
(b) Competitive Activities. During the term of the Agreement and for a
period of 60 months from the date of termination of Xxxxxxx'x employment, if the
Company terminates this Agreement for Cause or if Xxxxxxx terminates this
Agreement, without Good Reason, Xxxxxxx shall not, directly or indirectly
(whether for compensation or otherwise), alone or as an officer, director,
stockholder (excepting not more than 5% stockholdings for investment purposes in
securities of publicly held and traded companies), partner, associate, employee,
agent, principal, trustee, salesman, consultant, or in any other employment,
management or ownership capacity whatsoever, take any action in or participate
with or become interested in or associated with any person, firm, partnership,
corporation or other entity whatsoever that at the time Xxxxxxx joins such
party, (a) is engaged in any manner in the television programming and television
network business in United States of America or Mexico, or (b) plans to enter
such business (the "Competitive Activities"). In the event this Agreement is
terminated by the Company without Cause or if Xxxxxxx resigns for Good Reason,
the above restrictions shall also apply, however, the Competitive Activities
shall be limited to the Hispanic television programming and television network
business in the United States of America or Mexico.
6. Remedies for Breach. If Xxxxxxx breaches any of the provisions of
Section 5 of this Agreement, the Company shall have the following rights and
remedies, in addition to any others, each of which shall be independent of the
other and severally enforceable:
(i) The right to have the provisions of Section 5 of this
Agreement specifically enforced by any court having equity
jurisdiction in Tarrant County, it being acknowledged and agreed that
any such breach or threatened breach will cause irreparable injury to
the Company and that money damages will not provide an adequate remedy
to the Company;
(ii) The right and remedy to recover from Xxxxxxx the Company's
actual damages, including court costs and attorneys' fees, arising from
such default;
(iii) The right to require Xxxxxxx to account for and pay over to
the Company all compensation, profits, monies, accrual increments, or
other benefits (collectively the "Benefits") derived or received by
Xxxxxxx as a result of any transaction constituting a breach of any of
the provisions of Section 5, Xxxxxxx hereby agreeing to account for and
pay over the benefits to the Company; and
(iv) The right to terminate Xxxxxxx'x employment pursuant to
Section 7 of this Agreement.
7. Termination of Agreement.
(a) Death or Total and Permanent Disability. This Agreement shall
automatically terminate upon the death or total and permanent disability of
Xxxxxxx. Total and permanent disability shall mean an infirmity preventing
Xxxxxxx from performing his duties under this Agreement without any hope or
expectation of an ability to resume such duties during the Term as determined by
Xxxxxxx'x treating physician. If Xxxxxxx'x employment is terminated due to death
or total and permanent disability, Xxxxxxx or Xxxxxxx'x estate, as the case may
be, shall be entitled to receive (i) his then current daily salary for a period
of two months following the date of such termination, based upon the per annum
salary set forth in Subsection 4(a) hereof The timing and manner of payment of
such salary shall be in accordance with the salary arrangements in effect as to
Xxxxxxx prior to his termination of employment.
(b) Temporary Disability. For purposes of this Subsection 7(b),
temporarily disabled or temporary disability shall mean an infirmity preventing
Xxxxxxx from performing his duties hereunder which cannot or is not considered
total and permanent disability as defined in Subsection 7(a) hereof In the event
Xxxxxxx is temporarily disabled, this Agreement shall not terminate and Xxxxxxx
shall be entitled to receive (i) his then current salary during the first two
months of such disability, based upon the per annum salary set forth in
Subsection 4(a) hereof. The timing and manner of payment of such salary shall be
in accordance with the salary arrangements in effect as to Xxxxxxx at the onset
of the disability. No additional salary shall be paid to Xxxxxxx until he is
able to perform his duties on a full-time basis.
(c) Termination For Cause. The Company may terminate this Agreement
any time for "Cause" in accordance with the procedures provided in this
Subsection 7(c). Termination by the Company of Xxxxxxx'x employment for "Cause"
shall mean conduct amounting to (i) substantial neglect or inattention by
Xxxxxxx of his duties under this Agreement, (ii) fraud or dishonesty against the
Company, (iii) Xxxxxxx'x willful misconduct, repeated refusal to follow the
reasonable directions of the board of directors of the Company, or knowing
violation of law in the course of performance of the duties of Xxxxxxx'x
employment with the Company, (iv) repeated absences from work without a
reasonable excuse, (v) repeated intoxication with alcohol or drugs while on the
Company's premises during regular business hours, (vi) a conviction or plea of
guilty or nolo contendere to a felony or a crime involving dishonesty, or
(vii) a breach or violation of the terms to this Agreement or other agreement to
which Xxxxxxx and the Company are party. In the event of termination of
Xxxxxxx'x employment for Cause, Xxxxxxx shall be entitled to receive the base
salary set forth in Subsection 4(a) hereof through the date of termination and
shall not be entitled to any Management Bonus or other benefits on a prospective
basis. Prior to termination of Xxxxxxx'x employment for "Cause," the Company
shall be required to provide written notice to Xxxxxxx of the act or omission
complained of, giving reasonably specific details, and Xxxxxxx shall be given a
period of 30 days in which to cure or correct such act or omission, in which
event the right to terminate for "Cause" in respect of such act or omission
shall be extinguished.
(d) Other Termination. During the Term, if Xxxxxxx'x employment is
terminated without Cause or if Xxxxxxx resigns for Good Reason (as hereinafter
defined), he shall nevertheless be entitled to receive, in consideration in part
for his compliance with Section 5, total post-termination compensation equal
(i) to his then current daily salary for a period of three months, based upon
the per annum salary set forth in Subsection 4(a) of this Agreement; provided,
however, if Xxxxxxx engages in any competitive activity directly or indirectly,
at any time subsequent to termination without Cause or resignation for Good
Reason, thereafter he shall not be entitled to any such post-termination
compensation. The timing and manner of payment of such salary shall be in
accordance with the salary arrangements in effect as to Xxxxxxx prior to his
employment termination. "Good Reason" shall mean the continuing breach of a
material provision of this Agreement by the Company. Prior to termination of
Xxxxxxx'x employment for Good Reason, Xxxxxxx shall be required to provide
written notice to the Company of the act or omission complained of, giving
reasonably specific details, and the Company shall be given a period of 30 days
in which to cure or correct such act or omission, in which event the right to
terminate for "Good Reason" in respect of such act or omission shall be
extinguished.
8. Communications. Any notice, request or other communication required
or permitted by this Agreement to be mailed, given or delivered to Xxxxxxx shall
be in writing, addressed to- him at his address shown below or at such other
address as he shall have furnished from time to time to the Company for the
purposes hereof, and any payment to Xxxxxxx under this Agreement may be made by
check delivered to him or mailed to or delivered at such address. Any notice,
request or other communication required or permitted by this Agreement to be
given to the Company is to be in writing, addressed to the Company, for the
attention of Chief Executive Officer, at the address of the Company's principal
office in 0000 Xxxxxxxx Xxxxx, Xxxxxx, Xxxxx 00000, or at such other address as
the Company shall have furnished to Xxxxxxx for the purposes hereof
9. Amendments. This Agreement may be amended or modified only by a
written instrument executed by the Company and Xxxxxxx.
10. BINDING EFFECT. This Agreement shall be binding upon, and shall
inure to the benefit of, Xxxxxxx; the obligations of Xxxxxxx under the Agreement
are personal and this Agreement may not be assigned by Xxxxxxx. This Agreement
shall be binding upon, and shall inure to the benefit of, the Company and shall
also bind and inure to the benefit of any successor of the Company by merger or
consolidation or any assignee of all or substantially all of its properties or
business, but, except to any such successor or assignee of the Company, this
Agreement may not be assigned by the Company. The Company agrees that it shall
be a condition to consummation of any transaction involving a permitted
assignment of this Agreement that such successor or assignee agree in writing to
assume the obligations of the Company under this Agreement; provided, however,
such permitted assignment shall not relieve the Company of such obligations.
11. Applicable Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas, without regard for conflicts
of law rules and, in the event that any party to this Agreement shall bring a
suit or cause of action in a court of law for construction, interpretation, or
enforcement of this Agreement, or for damages or injunctive relief for an
alleged breach of the terms or provisions of this Agreement, then venue for any
such suit or cause of action shall be exclusively in Tarrant County, Texas.
12. Severability. If any provision of this Agreement shall, to any
extent, be invalid or unenforceable, the remainder of this Agreement shall not
be affected, and each term hereof shall be valid and shall be enforced to the
extent permitted by law.
13. Counterparts. This Agreement may be executed in multiple
counterparts, each of which is to be deemed an original, but all of which,
together, constitute one and the same instrument.
14. Entire Agreement. This Agreement shall constitute the entire
agreement between the parties superseding all prior agreements, and may not be
modified or amended, and no waiver shall be effective, unless by written
document signed by both parties hereto; provided, however, no modification,
amendment or waiver by the Company shall be effective unless approved by the
board of directors of the Company and recorded in the approved minutes of such
meeting. In the event of any inconsistency between the provisions of this
Agreement and the provisions of any other document or instrument, or rule or
procedure of the Company, the provisions of this Agreement shall be controlling.
15. Enforcement. In the event either party resorts to a lawsuit or
initiation of arbitration to enforce this Agreement, the prevailing party shall
be entitled to recover the reasonable costs of pursuing a lawsuit or
arbitration, including court costs and reasonable attorney's fees.
EXECUTED effective as of the day and year first above written.
HISPANO TELEVISION VENTURES, INC., a
Texas corporation
By: /s/ P. Xxxx Xxxxxxx
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Title: Chief Executive Officer
/s/ P. Xxxx Xxxxxxx
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P. Xxxx Xxxxxxx
Address
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxx 00000
