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EXHIBIT 10.4
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT, dated as of March 15, 2000 between MediaNews
Services, Inc. (the "Company"), a corporation organized and existing under the
laws of the State of Delaware to provide management services to various entities
conducting the business of publishing newspapers and XXXXXXX XXXX XXXXXXXXX (the
"Executive").
WITNESSETH:
WHEREAS, the Company wishes to employ and retain the services of
Executive, and Executive wishes to be employed by the Company.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the Company and the Executive agree as follows:
1. Period of Employment and Compensation
Company shall employ the Executive to perform the services described
with his principal office activities being situated in Denver, Colorado, or such
other location as the Executive shall elect, for the period commencing January
1, 2000, and terminating at the close of business December 31, 2009, unless
thereafter extended as subsequently provided in this Section, during which
period the Executive shall:
(a) be paid a base salary, in equal monthly installments, on
the regular pay day established for executives of the Company, at the
annual rate of Seven
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Hundred Seventy-One Thousand Dollars ($771,000.00) commencing January
1, 2000, which salary shall be increased annually thereafter,
commencing January 1, 2001, at an annual rate of five percent (5%), or
such higher annual rate as the Company shall determine appropriate;
provided, that if the Chief Executive Officer of the Company determines
that business conditions are such that the foregoing increases should
in whole or in part be deferred until those business conditions
improve, then the Chief Executive officer may elect appropriately to
defer such increases;
(b) be reimbursed in a manner consistent with policies of the
Company established for executive personnel, for all reasonable
expenses of the Company incurred by the Executive in the discharge of
any duties hereunder;
(c) receive such fringe benefits including accident,
hospitalization, disability, medical and life insurance plans, as shall
be made generally available to the executive personnel or other
employees of the Company; provided, however, that all payments made
payable to the Executive under this Agreement shall be subject to
withholding for any applicable taxes, social security or other
governmental levies and for insurance, savings or any other deductions
authorized by or for the benefit of the Executive under the programs
established for or made available to the executive personnel or other
employees of the Company.
(d) throughout the term of his employment, be assisted by the
Company through the establishment of a split dollar life insurance
program adequate for his and his family's needs. Pursuant to this
program, the Company will, upon the Executive's request, periodically
advance on the Executive's behalf amounts equal
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to the annual premiums for such insurance. These advances will be
evidenced by promissory notes and will be collateralized by assignments
to the Company of the cash value of the insurance policies. If the
Executive chooses to pay all or a portion of the current annual cost of
such insurance himself, then the Company will reimburse the Executive's
related costs in doing so.
(e) be eligible to receive a bonus for the Company's current
fiscal year and each subsequent fiscal year commencing on or before the
termination of this Agreement of up to $200,000 payable as soon as
practicable after the end of the Company's fiscal year, based on a
comparison of operating profits to budget of the Company during such
fiscal year as follows:
(i) If operating profits for such fiscal year are 100%
or more of budget, then the $200,000 bonus shall be
payable in full;
(ii) If operating profits for such fiscal year are 90%
or more (but under 100%) of budget, then the bonus
amount payable shall be $150,000;
(iii) If operating profits for such fiscal year are 80%
or more (but under 90%) of budget, then the bonus
amount payable shall be $100,000;
(iv) If operating profits for such fiscal year are less
than 80% of budget, or if no budget has been
adopted and approved for such fiscal year pursuant
to the Company's Certificate of Incorporation and
bylaws, then no bonus shall be payable.
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The amount of the Executive's salary, fringe benefits and bonus
established hereunder shall constitute his entire compensation for all services
performed by him on behalf of MediaNews Services, MediaNews Group, Inc., their
subsidiaries and affiliates, except in so far as those entities may from time to
time elect, in their sole discretion, to pay to him such additional bonus or
other forms of additional compensation as may be deemed appropriate.
Effective January 1, 2010, this Agreement shall be automatically
renewed for additional periods of one year each; provided, however, that at
least one hundred and twenty (120) days prior to December 31, 2009 or the
expiration of any subsequent one-year term, either party may give notice to the
other, as provided for herein, terminating this Agreement as of December 31,
2009 or the next annual expiration date.
2. Duties.
The Executive shall perform such executive, managerial, business and
administrative duties as may be assigned to him by the Board of Directors of the
Company, it being presently intended that the Executive will serve as Vice
Chairman, President and Chief Executive Officer of MediaNews Services, Inc.,
MediaNews Group, Inc. and each of their affiliates and subsidiaries, subject to
the provisions of those entities' by-laws or other operative documents, and in
such capacities oversee the business of publishing and managing the newspapers
owned or managed by such entities, and otherwise serve in an administrative
capacity as a consultant with regard to the affairs of such entities in a manner
in accordance with his experience. All such services shall be
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rendered in diligent, competent, efficient and faithful manner commensurate with
the responsibilities involved.
3. Acceptance
The Executive accepts the aforementioned responsibilities at the
compensation and upon the terms specified herein. During the term of this
Agreement, the Executive shall devote his best efforts principally to the
service of the Company, its affiliates and their subsidiaries and the
performance of the duties specified above, it being understood that the
preponderance of the Executive's time will be applied to furthering the interest
of such entities; provided, however, that Executive's services concurrently as a
director (or otherwise overseeing operations) of a non-competing entity shall be
permitted hereunder. The Executive shall not, however, engage in any other
business activity or outside activity which is materially inconsistent with or
an impediment to the carrying out of his duties hereunder.
4. Vacation.
The Executive shall be entitled to an annual paid vacation of five
weeks, such vacation to be taken at such times as he may select.
5. Death or Incapacity.
In the event of death of the Executive during the term hereof, this
Agreement shall terminate, and, except for the rights of the Executive and his
beneficiaries under the split dollar life insurance program described in Section
1(d) and the benefit plans described in
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Section 1(c) of this Agreement, the Company shall not be subject to any further
obligation to such deceased Executive hereunder, except that the estate of said
Executive shall be entitled to receive the unpaid compensation due for service
prior to his death, and through and including the last day of the month in which
the Executive died, including any deferred compensation and/or bonuses which
then may have accrued in full or pro rata.
If, on account of physical or mental disability, the Executive shall
fail or be unable to perform the duties contemplated by this Agreement for a
period of 180 consecutive days, the Company may, at any time thereafter upon 30
days' notice to the Executive, terminate this Agreement. In such event, this
Agreement shall terminate and come to an end on the date set forth in such
notice as if such date were the termination date of this Agreement, but said
Executive shall be entitled to receive his salary, benefits and any other
applicable compensation or reimbursement for expenses through the effective date
of the termination of this Agreement, as set forth in such notice.
6. Covenant Not To Compete.
The Executive agrees during the term of this Agreement and for a period
of five (5) years after any termination hereof, that he will not, within any
geographical areas in which newspapers owned or managed by the Company, its
affiliates and/or their subsidiaries are now or may hereafter be circulated in
material quantities, unless acting as an officer or employee of the Company, its
affiliates or their subsidiaries, or with the prior written consent of the
boards of directors thereof, directly or indirectly, own, manage, operate, join,
control, or participate in, or be connected as an officer, employee, partner,
independent contractor or otherwise with, any business enterprise which directly
or indirectly materially
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competes with such entities as the latter then conduct its business. The
Executive acknowledges that the remedy at law for any breach by him of this
covenant will be inadequate and that the Company shall be entitled to injunctive
relief for the same. The Executive agrees that such covenant is made in his
capacity as a shareholder and director of the Company, and not as an employee.
7. Termination For Cause.
Either party may terminate this Agreement prior to its stated term for
cause or in the event of a material breach thereof by the other. Such
termination shall be by notice in writing specifying such cause or material
breach and shall be effective on the date of said notice, without prejudice to
the rights of the party upon whom such notice is served to contest such
termination by any judicial means at such party's disposal.
For purposes of termination of this Agreement by the Company, the
following events shall, by way of illustration, and without any limitation, be
considered as cause:
(a) failure by the Executive to faithfully or diligently perform
any of his material obligations under this contract in the
manner provided, after he has received written notice from the
Company or MediaNews Group, Inc. of his alleged failure to
perform the same, and has failed within a reasonable period of
time substantively to cure such failure;
(b) theft, embezzlement or misappropriation by the Executive of
any funds or other property of the Company, its affiliates or
their subsidiaries;
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(c) any material act of self-dealing between the Executive and the
business of the Company, its affiliates or their subsidiaries
which is not disclosed in full to, and approved by, the boards
of directors of the Company and MediaNews Group, Inc.;
(d) intentional falsification by the Executive of any material
records or reports pertaining to the Company, its affiliates
or their subsidiaries;
(e) fraud or similar misconduct on the part of the Executive
pertaining to the Company, its affiliates or their
subsidiaries;
(f) failure to adhere to the normal and customary duties and
ethics within the newspaper industry attendant to the
positions which he may from time to time hold at the
newspapers owned by the Company, its affiliates or their
subsidiaries, promptly after he has received notice from the
Company or MediaNews Group, Inc. of his alleged failure to
adhere to the same; or
(g) any conviction or a plea of nolo contendre with respect to any
felony or any other serious crime which causes the Executive,
or his continued employment by the Company, to become a source
of material embarrassment, disgrace or ridicule to the
Company, its affiliates or any of their newspapers.
In the event of such termination the Executive shall be entitled to
receive compensation only through the date of his termination, and the Company
shall reserve all rights, if any, which it may have against the Executive under
this Agreement or otherwise, in connection with the termination or otherwise.
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8. Notices.
All communications and notices made pursuant to this Agreement shall be
in writing and delivered by hand or sent by certified mail or telegram as
follows:
(a) If to Company, to:
MediaNews Services, Inc.
c/o MediaNews Group, Inc.
Attn: Xxxxxx X. Xxxxxxx, XX
Executive Vice President and
Chief Financial Officer
0000 Xxxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
With a copy to:
Verner, Liipfert, Bernhard, XxXxxxxxx
and Hand, Chartered
Attn: Xxxxxx X. Xxxxx, Xx.
000 Xxxxxxxxx Xxxxxx, X.X., Xxxxx 000
Xxxxxxxxxx, X.X. 00000
(b) If to the Executive, addressed to:
Xxxxxxx Xxxx Xxxxxxxxx
0000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
or to such other address as either of the foregoing may from time to time
specify in writing.
9. Interpretation.
No provision of this Agreement may be altered, waived, discharged or
terminated except in writing, executed by the party against whom enforcement of
any alteration, waiver, discharge or termination is sought. No waiver of any
breach by either party to this Agreement shall operate or be construed as a
waiver of any subsequent breach by any party. This Agreement constitutes the
entire contract between the parties hereto with
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respect to employment, and no party shall be bound in any manner related to
employment by any warranties, representations or guarantees, except as
specifically set forth in this Agreement. This Agreement shall be interpreted
under the laws of the State of Delaware.
10. Successors and Assigns.
This Agreement shall be binding upon the parties hereto, their
respective heirs, legal representatives, successors and assigns, but may not be
assigned by either party without the prior written consent of the other party,
and any assignment without such consent shall be void and of no effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
MediaNews Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx, XX
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Xxxxxx X. Xxxxxxx, XX
Executive Vice President and
Chief Financial Officer
/s/ Xxxxxxx Xxxx Xxxxxxxxx
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Xxxxxxx Xxxx Xxxxxxxxx
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