AMERICAN RADIO EMPIRE, INC.
December 15, 2000
Xx. Xxxx Xxxxxx
0000 Xxxx Xxxxxx Xxxxx
Xxxxxx, Xxxxx 00000
Dear Dain:
Please accept this amended Employment Agreement from American Communications
Enterprises, Inc., ("ARE" or "the Company"). This Agreement supercedes any other
existing agreement, with the understanding that we agree to the following:
Recitals
1. Xxxx Xxxxxx ("Xxxxxx") has acquired outstanding and special skills and
abilities and an extensive background in and knowledge of ARE's industries.
2. ARE desires the services of Xxxxxx, and is therefore willing to engage his
services on the terms and conditions stated below.
3. Xxxxxx desires to be employed by ARE and is willing to do so on those terms
and conditions.
Now, therefore, in consideration of the above recitals and of the mutual
promises and conditions in this Agreement, it is agreed as follows:
Employee's Duties and Authority
The Company has already hired Xxxxxx (and further codified by the execution of
this amended agreement) as its President and Chief Executive Officer for a
period of no less than five years with automatic five-year term renewals. Xxxxxx
is responsible for overseeing the following areas:
A) Day-to-day oversight of the business operation of all radio stations
acquired and corporate headquarters;
B) Such in-station consultation functions as may be required directly by
you;
C) Directing the staffing, training and managing of all needed employees;
D) Investigation, negotiation and acquisition of additional radio
stations and Internet services;
E) Overseeing the creation of customized satellite and Internet
programming for ARE's own radio networks; and
Page 1 of 5
AMERICAN RADIO EMPIRE, INC.
F) Performing such other functions as the corporation may from time to
time assign to Xxxxxx.
Reasonable Time and Effort Required
During his employment, Xxxxxx shall devote such time, interest, and effort to
the performance of this Agreement as may be fair and reasonable.
Non-Competition During Employment
During the employment term, Xxxxxx shall not, in any fashion participate or
engage in any activity or other business competitive with the Employer's
business. In addition, Xxxxxx, while employed, shall not take any action without
ARE's prior written consent to establish, form, or become employed by a
competing business on termination of employment by ARE. Xxxxxx'x failure to
comply with the provisions of the preceding sentence shall give ARE the right
(in addition to all other remedies ARE may have) to terminate any benefits or
compensation that Xxxxxx may be otherwise entitled to following termination of
this Agreement.
Compensation
Your compensation will provide you with the following:
A) A base salary of $137,500 per year with an automatic 10% annual raise.
You will receive equity in the Company in the form of stock, not to be less than
10%. You will be provided specific annual performance goals as an incentive plan
that, should you attain those goals, will pay you an annual bonus equal and
additional shares of restricted ARE stock or stock options at the discretion of
the Board of Directors.
B) The Company will pay for such key man life insurance as may be required
by its corporate lenders.
C) The Company will provide you and your family with comprehensive group
medical insurance including dental.
D) The Company will provide you with a corporate vehicle of your choice or,
in lieu of that, make the monthly car payments of any vehicle you own that will
be designated as the corporate vehicle.
E) The Company will reimburse you for any and all expenses as may be
reasonably necessary and customary for the direct performance of your
obligations hereunder, including all travel, long distance phone calls, staff
help, office rent and expenses, etc. This will also include the costs of
relocation of your office and even yourself and your family if ever necessary or
desired.
Page 2 of 5
AMERICAN RADIO EMPIRE, INC.
Employee's Right of Ownership (Intellectual Property)
All inventions, creative programming or marketing ideas conceived or developed
by Xxxxxx during the term of this Agreement shall remain the property of Xxxxxx,
provided, however, that as to all such inventions with respect that the
equipment, supplies, facilities, or trade secret information of ARE was used, or
that relate to the business of ARE or to ARE's actual or demonstrably
anticipated research and development, or that result from any work performed by
Xxxxxx for ARE shall remain the property of ARE. ARE also acknowledges that
Xxxxxx has already provided ARE with a number of items, including, but not
limited to broadcast programming formats, slogans, monikers, logos and operating
paperwork systems. These items existed with Xxxxxx before the formation of ARE.
Should Xxxxxx be involuntarily removed from his position with ARE, ARE must
either immediately cease using any and all of those items or must pay Xxxxxx a
licensing fee of no less than $100,000 a year from that point on for as long as
those items are utilized in any form or fashion with ARE.
Indemnification By Employer
ARE shall, to the maximum extent permitted by law, indemnify and hold Xxxxxx
harmless against, and shall purchase indemnity insurance, if available, on
behalf of Xxxxxx for expenses, including reasonable attorney fees, judgments,
fines, settlements, and other amounts actually and reasonably incurred in
connection with any proceeding arising by reason of Xxxxxx'x employment by ARE.
The Company shall advance to Xxxxxx any expense incurred in defending any such
proceeding to the maximum extent permitted by law.
Involuntary Termination of Agreement
Should ever the need arise, by consideration and simple majority vote of the
Board of Directors, for your involuntarily leaving your position and the company
before the end of the existing three year term of this agreement, you will be
paid the remaining balance of that term's salaries in cash at the time of your
departure plus any bonuses or stock options that would be due to you at that
time.
Termination or Assignment on Merger
In the event of a merger where ARE is not the surviving entity, or of a sale of
all or substantially all of ARE's assets, ARE may, at its sole option (1) assign
this Agreement and all rights and obligations under it to any business entity
that succeeds to all or substantially all of ARE's business through that merger
or sale of assets, or (2) on at least 30 days' prior written notice to Xxxxxx,
terminate this Agreement effective on the date of the merger or sale of assets.
Should ARE elect this second option, the Company must then pay Xxxxxx the
remaining balance of his three-year term's salaries in cash, repay Xxxxxx for
any and all loans he has made to the Company, reimburse him for any and all
outstanding, out-of-pocket expenses he has incurred and has not yet been
reimbursed for, stock options and enter into a licensing agreement for Xxxxxx'x
Intellectual Property.
Page 3 of 5
AMERICAN RADIO EMPIRE, INC.
Non-disclosure After Termination
Because of his employment by ARE, Xxxxxx will have access to trade secrets and
confidential information about ARE, its services, its customers, and its methods
of doing business. In consideration of his access to this information, Xxxxxx
agrees that for a period of two years after termination of his employment, he
will not disclose such trade secrets or confidential information.
Liquidated Damages (for Employee)
In the event of any material breach of this Agreement on the part of ARE, Xxxxxx
at his sole option, may terminate his employment under this Agreement and, at
his sole option, shall be entitled to receive as liquidated damages, the full
amount of the basic salary and incentive compensation provided three years
following Xxxxxx'x exercise of his option to terminate his employment under this
Agreement. The amounts payable to Xxxxxx under this subsection shall be payable
in monthly installments on the first day of each month of the term of these
payments.
Entire Agreement
This Agreement contains the entire Agreement between the parties and supersedes
all prior oral and written Agreements, understandings, commitments, and
practices between the parties. No amendments to this Agreement may be made
except by a writing signed by both parties.
Choice of Law
The formation, construction, and performance of this Agreement shall be
construed in accordance with the laws of Texas.
Notices
Any notice to ARE required or permitted under this Agreement shall be given in
writing to ARE, either by personal service or by registered or certified mail,
postage prepaid, addressed to ARE at its then principal place of business. Any
such notice to Xxxxxx shall be given in a like manner and, if mailed, shall be
addressed to him at his home address then shown in ARE's files. For the purpose
of determining compliance with any time limit in this Agreement, a notice shall
be deemed to have been duly given (1) on the date of service, if served
personally on the party to whom notice is to be given, or (2) on the second
business day after mailing, if mailed to the party to whom the notice is to be
given in the manner provided in this section.
Page 4 of 5
AMERICAN RADIO EMPIRE, INC.
Severability
If any provision of this Agreement is held invalid or unenforceable, the
remainder of this Agreement shall nevertheless remain in full force and effect.
If any provision is held invalid or unenforceable with respect to particular
circumstances, it shall nevertheless remain in full force and effect in all
other circumstances.
If this is satisfactory and adequately reflects our agreements to date. please
so indicate with your signature below.
/s/Xxxx Xxxxxx Date: December 15, 2000
Xxxx Xxxxxx, Chairman, American Radio Empire, Inc.
00000 Xxxxxxxxx Xxxxxxx, Xxxxxxxx X, Xxxxxx, Xxxxx 00000
(000) 000-0000 FAX-(815) 000-0000
AGREED & ACCEPTED
This 15th day of December, 2000
/s/Xxxx X. Xxxxxx
Xxxx X. Xxxxxx (individually)
