EXHIBIT 10.11
FOX/LIBERTY NETWORKS, LLC
00000 Xxxx Xxxx Xxxx.
Xxx Xxxxxxx, XX 00000
Gentlemen:
This letter, when executed by each of T and T Entertainment Limited an
Irish corporation ("Employer"), Xxxxxxx X.X. Xxxx ("Employee"), and Fox/Liberty
Networks, LLC (hereinafter referred to as "the Company"), will confirm the
Agreement between Employer and the Company relating to Employers grant to the
Company the exclusive right to utilize Employees services during the Term of
this letter. This Agreement will supersede all prior Agreements between
Employee and the Company relative to Employee's employment with the Company or
any affiliate of the Company.
1. (a) The Employer hereby agrees to cause Employee to render services upon
the terms and conditions herein set forth for a period of four years,
commencing March 1, 1997 and ending February 28, 2001.
(b) One hundred eighty (180) days prior to the expiration of the Term, the
parties will enter into good faith negotiations to agree upon the Terms of
an extension of this Agreement. If the parties cannot mutually agree on the
Terms of an extension, and Employee continues to render services to the
Company after the end of the above Term, this Agreement shall be terminable
at will on one week notice. Amounts payable to Employee during such
extended period shall be at the rate paid during the last regular payment
period hereunder.
2. (a) Employer shall cause Employee to render services as President and
Chief Operating Officer of Fox/Liberty Network, LLC and International
Sports Programming Partners. Employer shall cause Employee to perform the
function of and have the authority customarily vested in a cable network
President and Chief Operating Officer and report directly to the Chairman
and Chief Executive Officer ("CEO") of the Company. Subject to the
directives of the Company's Chairman and CEO and the Board of Directors,
Employer shall cause Employee to directly supervise and have authority over
those functions indicated on the organization chart included in Appendix 1
of this Agreement.
(b) If Employee is elected member of the Board of Directors or to any other
office of the Company or any of its affiliates, Employer will cause
Employee to agree to serve in such capacity or capacities without
additional compensation, however, Employee will be covered by corporate
indemnification programs in the same manner as other corporate officers.
3. Employer shall cause Employee to perform such duties consistent with the
position set forth in Paragraph 2(a), as are assigned by the Company from time
to time. The principal place for performance shall be at the Company's
principal office in Los Angeles, California subject to such
travel, as the rendering of the services hereunder may require. Such travel may
be either within or outside the United States of America. In the event Employee
suffers at major family crisis (i.e. death or serious illness ) the services to
be rendered hereunder may be rendered from the London office, on a temporary
basis.
4. For Employees services hereunder, the Company will, during the Term
described in Paragraph 2.(a) hereof, on a monthly basis, pay Employer at the
rate of:
(a) $800,000 per annum, provided, that as of March 1, 1998, March 1, 1999,
March 1, 2000 and March 1, 2001 the base amount shall be increased (as
increased from time to time, the "Base Amount") in an amount to be
determined in the sole discretion of the Company, but in no event shall the
increase of the Base Amount in any year be less than an amount equal to the
percentage increase in the "All-Urban" consumer price index published by
the United States Bureau of Labor Statistics for the Los Angeles,
California Metropolitan Area (the "Index") between February 28 of the then
current year and March 1 of the preceding year. If the index shall no
longer be published by the Bureau of Labor Statistics, then any substitute
or successor index published by such Bureau, or other governmental agency
of the United States shall be used. If the index (or a successor or
substitute index) is not available, a reliable governmental or other
reputable publication reasonably selected by the Company which evaluates
the information heretofore used in determining the Index shall be used.
(b) During the Term the amounts payable hereunder shall be paid denominated
in US dollars, but may be paid in another currency to a local bank account
as requested by Employer, and payable in a form as requested by Employer,
subject to any and all withholdings and deductions required by applicable
employment laws.
(c) The allocation of the amounts payable hereunder for services rendered
to Fox/Liberty Networks, LLC and its subsidiaries, and for services
rendered to International Sports Programming Partners and its subsidiaries,
shall be based upon the number of days Employee provides services to all
such entities in such contract year.
5. (a) Employer and Employee agree that during the Term of this Agreement
neither party shall have any interest, directly or indirectly, in any
motion picture or television producing, distributing or exhibiting
business, or in any broadcasting cable or film laboratory business or in
any related business other than the Company and its affiliates, and neither
party will perform any services for any person, firm or corporation engaged
in any such business. The foregoing does not prohibit ownership of less
than one percent (1%) of the outstanding common stock of any Company whose
shares are publicly traded.
(b) Enclosed is a copy of the Company's Conflict of Interest Statement.
Employer and Employee agree to abide by the provisions of this statement at
all times during the Term of this Agreement.
2
6. Employer and Employee will not during the Term of this Agreement and for a
period of two years thereafter, directly or indirectly, induce or attempt to
induce any managerial, sales or supervisory employee of the Company or its
affiliates to render services to any other person, firm or corporation.
7. (a) The Employer and Employee's obligations to the Company are exclusively
contractual in nature. The Company shall be the sole owner of all the
fruits and proceeds of Employee's services hereunder, including, but not
limited to, all ideas, concepts, formats, suggestions, developments,
arrangements, designs, packages, programs, promotions and other
intellectual properties which may be created in connection with and during
the Term of this Agreement free and clear of any claims by Employer and
Employee of any kind or character whatsoever (other than Employer and
Employee's right to payment hereunder). Employer shall cause Employee, at
the request of the Company, to execute such assignments, certificates or
other instruments as the Company may from time to time deem necessary or
desirable to evidence, establish, maintain, perfect, protect, enforce or
defend its right, title and interest in or to any such properties.
(b) All memoranda, notes, records and other documents made or compiled by
Employer or Employee, or made available to Employer or Employee during the
term of this Agreement concerning the business of the Company or its
affiliates shall be the Company's property and shall be delivered to the
Company on the termination of this Agreement or at any other time on
request. Employer and Employee shall keep in confidence and shall not use
for it or others, or divulge to others, any information concerning the
business of the Company or its affiliates which is not otherwise publicly
available and which is obtained as a result of performance of
services hereunder, including but not limited to, trade secrets or
processes and information deemed by the Company to be proprietary in
nature, unless disclosure is permitted by the Company or required by law.
(c) The Company shall have the right to use Employee's approved biography
and likeness in connection with its business, including in advertising its
products and services, and may grant this right to others, but not for use
as a direct endorsement.
(d) The covenants set forth above in this paragraph shall survive the
termination of this Agreement as mutually agreed among the parties.
8. Notwithstanding that Employer is furnishing Employees services to the
Company hereunder, solely for the purposes of determining participation in all
employee benefit plans, an employment relationship exists between Company, as
employer, and Employee, as employee. In this regard, Employee shall be eligible
to participate in all employee benefit plans of the Company available to other
comparable executives of the Company and Employee's eligibility to participate
in such plans shall be governed by the rules applicable to comparable
executives, including but not limited to the following:
3
(a) Vacation. Employee will be entitled to four (4) weeks of vacation for
--------
each full year that Employee is employed, and pro-rata vacation for a part
of any year that Employee is employed.
(b) Personal Travel. The Company will provide up to two (2) non-business
---------------
related round trip tickets between London and Los Angeles for Employee and
up to a total of sixteen (16) round trip tickets between London and Los
Angeles for Employee, his partner, or his children for personal use in each
year of the Term of the Agreement.
(c) Tax & Pension Advice. The Company will reimburse Employer for the cost
--------------------
of independent tax and pension advice required as a result of the
consummation of this Agreement, and the completion of all items
contemplated hereunder.
(d) Medical, Dental, Disability and Life Insurance. Employee shall
----------------------------------------------
continue to participate in the Company's current group medical, dental,
permanent disability and life insurance benefit plans for the Term of this
Agreement.
9. During the Term, the Company shall pay to, or provide to, Employer the
following additional amounts or rights:
(a) Stock Appreciation Rights Plan. The Company will develop a stock
------------------------------
appreciation rights ("SAR") plan in which Employer (for the benefit of
Employee) shall have the right to participate no later than April 30, 1997.
The SAR plan shall be of a type equal to or better than that previously
offered to Liberty Media employees of like status. The Company agrees to
provide Employer (for benefit of Employee) with comparable economic value
if a SAR plan for the Company is not enacted. In the event of a public
offering, SARs will be converted to public stock.
(b) Additional Fee. Employer shall be entitled to receive an additional
--------------
fee in an amount to be determined in the sole discretion of the Company,
but in no event less than bonus amounts other Fox executives receive in
connection with rendition of comparable services for comparable positions.
(c) Car Allowance. The Company shall reimburse Employer for, or assume
-------------
Employer's obligation to Employer for, (i) a car allowance at a rate of
$18,000 per annum or such higher amount as may be provided to senior
executives of the Company (other than the Chairman of the Company); and,
(ii) a living allowance until such time as Employee relocates to the United
States. If Employee relocates his family during the Term of this
Agreement, the amount otherwise payable by the Company as a living
allowance shall be payable as additional compensation, provided that such
additional compensation in no event be deemed to be part of the Base Amount
for the purposes of the Base Amount increases and additional amounts to be
paid under Section 3.(a) above.
4
(d) Relocation. If Employee relocates his family to the United States, the
----------
Company will reimburse Employer for relocation expenses to a standard
previously provided to News Corp executives at a comparable level.
(e) Pension Plan. The Company will reimburse Employer for contributions to
------------
any pension plan Employer provides to Employee at a level equal to
comparable executive contributions to the Fox 401(k) and pension plans.
The Company agrees to reimburse Employer in the gross amount of $14,500 in
each year of the Agreement, provided that as of March 1, 1998, March 1,
1999, March 1, 2000 and March 1, 2001 the amount reimbursed shall be
increased based on maximum contribution rates set by the Internal Revenue
Service for qualified pension plans. Employer will be responsible for
maintaining appropriate records for tax purposes.
10. Subject to such policies as may from time to time be established by the
Company, the Company shall pay or reimburse Employer, or assume Employer's
obligation to pay, or reimburse Employee, in the same manner as other Fox
executives of the same title for all reasonable expenses actually incurred or
paid by Employee during the Term in the performance of services under this
Agreement upon presentation of expense statements or vouchers or such other
supporting information as the Company may reasonably require; provided, however,
that maximum amounts available for such expenses during any period may be fixed
in advance by the Board of Directors or the CEO of the Company.
11. Notwithstanding that Employer is furnishing Employee's services to the
Company hereunder, for the purposes of any applicable Workers' Compensation
statute, an employment relationship exists between Company and Employee, Company
being Employee's special employer hereunder and Employer being Employee's
general employer (as the terms "special employer" and "general employer" are
understood for purposes of Workers' Compensation statutes). Between Employer
and Company, Company shall have the exclusive right to direct and control the
performance of Employee's services hereunder. The rights and remedies, if any,
of Employee and/or Employee's heirs, executors, administrators, successors and
assigns against the Company and/or the Company's agent and/or Employee's by
reason of injury, illness, disability or death. If the applicability of any
Workers' Compensation statutes to the engagement of Employee's services
hereunder is dependent upon (or may be affected by) an election on the part of
the Employer, Employee and/or the Company, such election is hereby made in favor
of such application.
12. Notwithstanding any provision to the contrary, in the event of the
termination of Employee's services by the Company, the Company shall be
obligated to continue to pay Employer for the balance of the Term at the Base
Amount paid during the last regular payment period prior to termination
hereunder, per month. Employee shall use all reasonable efforts to find other
appropriate employment as soon as practicable and the payment of severance shall
be conditioned upon the Employee doing so. If Employee finds such new
employment during the period that the Company is obligated to pay severance to
Employer hereunder, the amount payable to the Employer each month shall be
reduced by the amount per month the Employee earns or is entitled to earn at
5
his new place of employment in respect of the period covered by the severance.
13. Employee's services and the rights granted the Company hereunder are of a
special, unique, unusual, extraordinary, and intellectual character which gives
them a peculiar value, the loss of which cannot be reasonably or adequately
compensated in damages in any action at law, and a breach by the Employer or
Employee of any of the provisions contained herein may cause the Company
irreparable injury and damage. Employer and employee expressly agree that the
Company shall be entitled to seek injunctive and other equitable relief to
prevent a breach of this Agreement. Resort to such equitable relief, however,
shall not be construed as a waiver of any preceding or succeeding breach of the
same or any other term or provision. The various rights and remedies of the
Company hereunder shall be construed to be cumulative and no one of them shall
be exclusive of any other or of any right or remedy allowed by law.
14. In consideration of the making of this Agreement, as well as of the other
considerations stated herein, Employer and Employee expressly agree that any
contract, agreement or understanding between them and the Company with respect
to severance or termination pay, notice of severance or termination, or pay in
lieu of notice of severance or termination previously extended to Employer and
Employee whether by way of contract, letter, or Company termination policy, is
hereby rescinded. Employer and Employee further agree that if Employee
continues to render services to the Company after the end of this Agreement,
this Agreement shall be extended, but shall be terminated by either party on one
(1) week's notice and shall otherwise be modified in accordance with the
provisions of such then existing Company policies as may then be in effect
applicable to comparable executives of the Company.
15. This Agreement shall be governed by the laws of the State of New York
applicable to contracts performed entirely therein.
6
16. This Agreement shall inure to the benefits of the successors and general
assigns of the Company and to the benefit of any other corporation or entity
which is a parent, subsidiary or affiliate of the Company to which this
Agreement is assigned, and any other corporation or entity to which the Company
may be merged or with which it may be consolidated. Except as herein provided,
this Agreement shall be nonassignable.
Sincerely,
Fox/Liberty Networks LLC
By: /s/ Xxxxx Xxxxx
-----------------------------------------
Xxxxx Xxxxx
Chairman and Chief Executive Officer
Date: 4/11/97
-----------------------------------------
By: /s/ Xxxxxxx Xxxx
--------------------------
Xxxxxxx X.X. Xxxx
Date: 7 April 97
------------------------
T and T Entertainment Limited
By: /s/ X. Xxxxxxxx-Xxxxxx
------------------------
X. Xxxxxxxx-Xxxxxx
Date: 19 Apr 97
------------------------
7
APPENDIX I
________________________
| BOARD OF DIRECTORS |
|________________________|
|
|
_________________
| CEO |
|_________________ |
|
|
____________
| President, |
| COO |
|____________|
|
___________________________________________________________________________________________________________
| | | |
____________ ___________ _____________ ______________
| | | | | COO | | EVP |
| EVP Finance| |-| EVP, fX |___ __________| Regional | | International|
| | | | | |_____| | Sports | | |
|____________| | |___________| |_____________| |______________|
| |
| |
| |
____________ | _________ __________ |
| Treasurer | | | Prog/ | | Nat'l | |
| | |-| Prod | |-| Ad Sales | |
|___________ | | |_________| | |__________| |
| | |
| | |
____________ | _________ | |
| Controller,| | |Marketing| | |
| Sports | |-| | | |
|____________| | |_________| | ____________ |
| | | | |
| |-| Sports | |
____________ | _________ | |____________| |
| Controller,| | | Legal | | |
| fX | |-| | | |
|____________| | |_________| | |
| | |
| | ____________ |
____________ | _________ | | Enter- | |
| VP Bus. | | |Affiliate| |-| tainment | |
| Dev. | |-| Sales | |____________| |
|____________| |_________| |
|
|
|
|
_________________________________________________________________________________________
| | | | | | | |
_______ ___________ _________ __________ __________ ______ | _________
|Spot Ad| |Programming| |Marketing| |Regionals/| |Operations| |Legal | | |Affiliate|
| Sales | |-| | |-| | |-| Rights | |-| | | | | |Relations|
|_______| | |___________| | |_________| | |__________| | |__________| | _____| | |_________|
| | | | | |
| | ___________ | _________ | __________ | __________ |
| | | SVP | | |Marketing| | | College | | |Tech Ops | |
| |-|Production | |-| Svcs | |-| | |-| | ___________
| | |___________| | |_________| | |__________| | |__________| | Regional |
| | | | | | GMs |
| | ___________ | _________ | __________ | _________ |___________|
| | | Scheduling| | | On_Air | | | Regions | | | HR |
| |-| | |-| Promo | |-| | |-| |
| | |___________| | |_________| |__________| | |_________|
_______ | | |
| On_Air| | ___________ | _________ | _________
| | | | VP News | | | P.R. | | | MIS |
|_______| |-| | |-| | |-| |
| |___________| |_________| | |_________|
| |
| ___________ | _________
| | Graphics | | | Remote |
|-| | |-| |
|___________| |_________|
