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EXHIBIT 10.45
EMPLOYMENT AGREEMENT
AGREEMENT, dated as of May 2, 1997, between Ticketmaster Corporation,
an Illinois Corporation (the "Company"), and Xxxxx Xxxxxx ("Executive").
W I T N E S S E T H:
WHEREAS, prior to the date hereof, Executive has been employed
by the Company and its affiliates in various positions; and
WHEREAS, the Company is desirous of continuing to employ Executive, and
Executive is desirous of continuing to be employed by the Company, on the terms
and subject to the conditions set forth in this Agreement, with effect as of
February 1, 1997;
NOW, THEREFORE, in consideration of the premises, the mutual covenants
and agreements contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby mutually acknowledged, the parties
hereto agree as follows:
1. Definitions. The following terms shall have the
indicated meanings when used in this Agreement, unless the context
requires otherwise:
(a) "Base Salary Amount" shall mean $400,000 during the first
Contract Year, $410,000 during the second Contract Year, $425,000
during the third Contract Year, $435,000 during the fourth Contract
Year and $450,000 during the fifth Contract Year.
(b) "Benefit Plan" shall mean each vacation pay, sick pay,
retirement, welfare, medical, dental, disability, life insurance,
deferred compensation, incentive compensation, stock option or other
employee benefit plan, program or arrangement, if any.
(c) "Board of Directors" shall mean the Board of
Directors of the Company.
(d) "Cause" shall have the meaning ascribed to that term
in Section 7.
(e) "Consulting Period" shall have the meaning ascribed
to that term in Section 9(a).
(f) "Contract Year" shall mean each year during the term
hereof commencing February 1 and ending on the immediately following
January 31.
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(g) "Customer" shall have the meaning ascribed to that
term in Section 9(d).
(h) "Disability" shall have the meaning ascribed to that
term in Section 6(a).
(i) "Disability Period" shall have the meaning ascribed
to that term in Section 6(a).
(j) "Proprietary Information of the Company" shall have
the meaning ascribed to that term in Section 10.
(k) "Ticketmaster Businesses" shall have the meaning
ascribed to that term in Section 9(b).
2. Employment. The Company hereby employs Executive, and
Executive hereby accepts employment with the Company, on the terms
and subject to the conditions set forth herein.
3. Term of Employment. The term of employment covered
hereunder shall be the five-year period commencing on February 1,
1997 and ending on January 31, 2002, subject to early termination
as herein provided.
4. Position and Duties. Executive shall serve as the President
and Chief Operating Officer of Ticketmaster Ticketing Co., Inc. a wholly-owned
subsidiary of the Company ("Ticketing"). Subject to the authority of the Board
of Directors of Ticketing, Executive shall have all of the powers and duties
incident to the office of President and Chief Operating Officer and such other
powers and duties as may from time to time be prescribed by the Board of
Directors or the Chief Executive Officer. Executive agrees to serve without
further compensation, if elected or appointed thereto, as an officer or a
director of any of the Company's domestic and foreign subsidiaries and
affiliates. During Executive's employment by the Company, he will be entitled to
indemnification as an officer of the Company (and, if so elected, as an officer
or director of any of the Company's domestic and foreign subsidiaries or
affiliates) in the manner provided by the Illinois Business Corporation Act of
1983, as amended, and the Company's Articles of Incorporation and By-Laws, as
amended.
5. Exclusive Duties. During Executive's employment by the
Company, Executive shall devote his entire working time, attention
and energies to the business of the Company and will not take any
actions of the kind described in Sections 9(b), 9(c) and 9(d).
6. Compensation and Other Benefits.
(a) Base Salary. During each Contract Year of the term
hereof, the Company shall pay to Executive the Base Salary
Amount. The Base Salary Amount shall be paid to Executive in
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accordance with the Company's regular payroll practices with respect to
senior management compensation.
In the event that Executive shall become disabled as a result
of bodily injury or physical or mental illness (whether or not
occupational) to such extent that in the sole opinion of the Board of
Directors, based upon competent medical advice, he can no longer
perform the duties of President and Chief Operating Officer of
Authority of the Company (a "Disability"), the Company shall only be
obligated to continue to pay the Base Salary Amount to Executive for
the 120-day period immediately following the date of Disability (the
"Disability Period"). The right to receive salary payments during the
Disability Period, if applicable, shall survive any termination of
employment by virtue of Disability pursuant to Section 7.
(b) Annual Performance Bonuses. During each Contract Year, the
Company shall pay Executive an annual performance bonus as determined
by the Board of Directors or its Compensation Committee in its sole
discretion, the determination of which shall be based upon such
standards, guidelines and factual circumstances as the Board of
Directors or its Compensation Committee deems relevant, including,
without limitation, the operating results for the Company during such
Contract Year, the importance of the efforts of Executive in achieving
such operating results and the achievement by the Company and/or
Executive of performance goals previously established by the Board of
Directors or its Compensation Committee for such Contract Year;
provided, however, that in no event shall the bonus for any full
Contract Year of the term hereof be less than $75,000 during the first
Contract Year, $80,000 during the second Contract Year, $80,000 during
the third Contract Year, $90,000 during the fourth Contract Year and
$100,000 during the fifth Contract Year.
(c) Expenses. Executive shall be entitled to receive prompt
reimbursement from the Company for all documented business expenses
incurred by him in the performance of his duties hereunder, provided
that Executive properly accounts therefor in accordance with the
Company's reimbursement policy, including, without limitation, the
submission of supporting evidence as reasonably requested by the
Company.
(d) Fringe Benefits. During the term hereof, Executive shall
be entitled (i) to participate in and receive benefits under all of the
Company's Benefit Plans generally available to senior management of the
Company and (ii) to receive an automobile allowance in the amount of
$1,500 per month. Without limiting the generality of the foregoing,
Executive shall be entitled to participate in additional stock option
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grants or plans as may be available to executives of the Company from
time to time, in the sole discretion of the Compensation Committee of
the Board of Directors of the Company or its parent. To the extent not
covered by the Company's Benefit Plans, Executive shall be entitled to
reimbursement from the Company for all reasonable medical and health
expenses incurred by Executive for his benefit or for the benefit of
his dependents.
(e) Insurance. The Company agrees to maintain in effect during
the term hereof insurance on Executive's life payable to his estate or
his named beneficiary or beneficiaries in the amount of $1,500,000;
provided, however, that Executive shall reimburse the Company for any
and all premiums paid by the Company with respect to such insurance in
excess of the preferred or select premium rate for non-smokers. In
addition, so long as Executive is insurable at standard insurable rates
(which rates shall in no event increase during any Contract Year by a
percentage greater than the percentage increase in the consumer price
index for all urban workers (1967=100) over the indexed figure for the
immediately preceding Contract Year, in each case measured as of the
month of February), the Company agrees to also maintain in effect
during the term hereof a disability insurance policy with coverage
substantially equivalent to the coverage under the disability insurance
policy now in effect with respect to Executive.
(f) Vacations. During the term hereof, Executive shall be
entitled to sick leave and paid holidays consistent with the Company's
sick leave and holiday policy for senior management and up to three
weeks paid vacation during each Contract Year (or such other vacation
time as is consistent with the Company's policy for senior management).
7. Termination. The Company or Executive may terminate the employment
of Executive hereunder upon the occurrence of a Disability (as defined in
Section 6(a)) for a period of no less than 120 days during any consecutive
twelve-month period. The Company may also terminate the employment of Executive
hereunder upon Executive's death or for Cause. For purposes hereof, "Cause"
shall mean (i) fraud, theft, misappropriation of funds or conviction of a
felony, (ii) Executive's engagement in illegal conduct tending to place
Executive or the Company in disrepute, (iii) dereliction or gross misconduct in
Executive's performance of his duties as an employee of the Company or the
failure of Executive to perform his duties in a manner consistent with the
instructions of the Board of Directors, the Chief Executive Officer or the Chief
Operating Officer of the Company or (iv) violation by Executive of any of his
material covenants contained in this Agreement, including, without limitation,
Section 10. Notwithstanding the foregoing, before the Company may terminate the
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employment of Executive for Cause, the Company shall deliver to Executive not
less than ten business days prior written notice of the Company's intention to
terminate Executive's employment together with a statement of the basis for such
termination, and Executive shall be afforded (i) an opportunity to respond to
the Company during such ten-business day period and (ii) in the event that the
basis for such termination is clause (iii) or (iv) above, an opportunity to
remedy the situation resulting in the Company's determination to terminate for
Cause so long as such situation is non-repetitive in nature. Upon the
termination of Executive's employment for any reason, Executive shall be
entitled to receive all compensation (including, without limitation, a pro rata
portion of the minimum annual performance bonus, unless such termination is for
Cause) for the then current Contract Year through the date of such termination
plus all accrued but unreimbursed expenses. In addition, upon the termination of
Executive's employment for any reason other than for or by virtue of Cause,
death, Disability or Executive's voluntary termination of employment, the
Company shall continue to be responsible for the payment of all Base Salary
Amount and minimum annual performance bonuses for the remainder of the term
hereof; provided, however, that Executive shall have a duty to mitigate
commencing on the first anniversary of the date of termination; and, further
provided that Executive shall perform his covenants, duties and obligations
under Sections 9(b), 9(c) and 9(d) during the remainder of the term hereof.
8. Developmental Rights. Executive agrees that any developments by way
of invention, design, copyright, trademark or other matters which may be
developed or perfected by him during the term hereof, and which relate to the
business of the Company or its subsidiaries or affiliates, shall be the property
of the Company without any interest therein by Executive, and he will, at the
request and expense of the Company, apply for and prosecute letters patent
thereon in the United States or in foreign countries if the Company so requests,
and will assign and transfer the same to the Company together with any letters
patent, copyrights, trademarks and applications therefor; provided, however,
that the foregoing shall not apply to an invention that Executive develops
entirely on his own time without using the Company's equipment, supplies,
facilities or trade secret information except for those inventions that either:
(a) relate at the time of conception or reduction to
practice of the invention to the Company's business, or actual
or demonstrably anticipated research or development of the
Company; or
(b) result from any work performed by Executive for the
Company.
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9. Consulting.
(a) Consulting Services. During the two-year period commencing
immediately upon the termination of Executive's employment for any
reason (other than Executive's death) (the "Consulting Period"),
Executive shall be available for consultation with the Company and its
subsidiaries and affiliates concerning their general operations and the
industries in which they engage in business. In addition, during the
Consulting Period, consultant will aid, assist and consult with the
Company and its subsidiaries and affiliates with respect to their
dealings with clients and the enhancement of their recognition and
reputation. During the Consulting Period, Executive shall devote such
time and energies to the affairs of the Company as may be reasonably
required to carry out his duties hereunder without jeopardizing
Executive's then full-time, non-Ticketmaster Business employment
opportunities; provided, however, that Executive shall not be obligated
to devote more than 50 hours per year to the performance of such
duties. In consideration of Executive's consulting services, and in
consideration of Executive's covenants contained in this Section 9, the
Company shall pay to Executive $30,000 during each full year of the
Consulting Period, payable in equal monthly installments. The Company
further agrees to reimburse Executive for all reasonable and necessary
business expenses incurred by Executive in the performance of his
consulting services in accordance with the Company's reimbursement
policy, including, without limitation, the submission of supporting
evidence as reasonably required by the Company.
(b) Covenant Not to Compete. During the Consulting Period,
Executive shall not, without the prior written consent of the Company,
directly or indirectly engage in or assist any activity which is the
same as, similar to or competitive with the Ticketmaster Businesses
(other than on behalf of the Company or any of its subsidiaries or
affiliates) including, without limitation, whether such engagement or
assistance is as an officer, director, proprietor, employee, partner,
investor (other than as a holder of less than 5% of the outstanding
capital stock of a publicly traded corporation), guarantor, consultant,
advisor, agent, sales representative or other participant, anywhere in
the world that the Company or any of its subsidiaries or affiliates has
been engaged, including, without limitation, the United States, Canada,
Mexico, England, Ireland, Scotland, Europe and Australia. Nothing
herein shall limit Executive's ability to own interests in or manage
entities which sell tickets as an incidental part of their primary
businesses (e.g. cable networks, on-line computer services, sport
teams, arenas, hotels, cruise lines, theatrical and movie productions
and the like) and which do not hold themselves out generally as
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competitors of the Company and its subsidiaries and affiliates. The
"Ticketmaster Businesses" shall mean the computerized sale of tickets
for sporting, theatrical, cinematic, live theatrical, musical or any
other events on behalf of various venues and promoters through
distribution channels currently being utilized by the Company or any of
its subsidiaries or affiliates (as such term is defined in Rule 405 of
Regulation C promulgated under the Securities Act of 1933, as amended).
(c) Solicitation of Employees. During the Consulting Period,
Executive shall not (i) directly or indirectly induce or attempt to
induce (regardless of who initiates the contact) any person then
employed (whether part-time or full-time) by the Company or any of its
subsidiaries or affiliates, whether as an officer, employee,
consultant, adviser or independent contractor, to leave the employ of
the Company or to cease providing or otherwise alter the services then
provided to the Company or to any of its subsidiaries or affiliates or
(ii) in any other manner seek to engage or employ any such person
(whether or not for compensation) as an officer, employee, consultant,
adviser or independent contractor in connection with the operation of
any business which is the same as or similar to any of the Ticketmaster
Businesses.
(d) Non-Solicitation of Customers. During the Consulting
Period, Executive shall not solicit any Customers of the Company or any
of its subsidiaries or affiliates or encourage (regardless of who
initiates the contact) any such Customers to use the facilities or
services of any Competitor of the Company or any of its subsidiaries or
affiliates. "Customer" shall mean any person who engages the Company or
any of its subsidiaries or affiliates to sell, on its behalf as agent,
tickets to the public.
10. Confidentiality. Executive shall not at any time during or for a
period of sixty (60) months after termination of employment) disclose (except as
may be required by law) or use, except in the pursuit of the business of the
Company or any of its subsidiaries or affiliates, any Proprietary Information of
the Company. "Proprietary Information of the Company" means all information
known or intended to be known only to employees of the Company or any of its
subsidiaries or affiliates in a confidential relationship with the Company or
any of its subsidiaries or affiliates relating to technical matters pertaining
to the business of the Company or any of its subsidiaries or affiliates, but
shall not include any information within the public domain. Executive agrees not
to remove any documents, records or other information from the premises of the
Company or any of its subsidiaries or affiliates containing any such Proprietary
Information, except in the pursuit of the business of the Company or any of its
subsidiaries or affiliates, and acknowledges that such documents,
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records and other information are the exclusive property of the Company or its
subsidiaries or affiliates. Upon termination of Executive's employment,
Executive shall immediately return all Proprietary Information of the Company
and all copies thereof to the Company.
11. General Provisions.
(a) Expenses. All costs and expenses incurred by either of the
parties in connection with this Agreement and any transactions
contemplated hereby shall be paid by that party.
(b) Notices. All notices, demands and other communications
hereunder shall be in writing and shall be given or made (and shall be
deemed to have been duly given or made upon receipt) by delivery in
person, by overnight courier service, by cable, by telecopy, by
telegram, by telex or by registered or certified mail to the respective
parties at the following addresses (or at such other address for a
party as shall be specified in a notice given in accordance with this
Section 11(b)):
(i) If to the Company:
Ticketmaster Corporation
0000 Xxxxxx Xxxxxxxxx
Xxxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: President
Telecopy No.: (000) 000-0000
With a copy to:
Xxxx, Xxxxxx & Xxxxxxxxx
Xxx Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxx Gerber
Telecopy No.: (000) 000-0000
(ii) If to Executive:
Xxxxx Xxxxxx
000 X. Xxxxxx Xx.
Xxxxxxx Xxxxx, XX 00000
Telecopy No.: (000) 000-0000
(c) Headings. The descriptive headings contained in
this Agreement are for convenience of reference only and shall
not affect in any way the meaning or interpretation of this
Agreement.
(d) Successors; Binding Agreement. This Agreement shall
be binding upon and inure to the benefit of the parties hereto
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and their respective heirs, devisees, legatees, executors,
administrators, successors and personal or legal representatives. If
Executive is domiciled in a community property state or a state that
has adopted the Uniform Marital Property Act or equivalent or if
Executive is domiciled in a state that grants to his spouse any other
marital rights in Executive's assets (including, without limitation,
dower rights or a right to elect against Executive's will or to claim a
forced share of Executive's estate), this Agreement shall also inure to
the benefit of, and shall also be binding upon, his spouse. If
Executive should die while any amounts would still be payable to him
hereunder if he had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms
of this Agreement to Executive's designee or, if there be no such
designee, to Executive's heirs, devisees, legatees or executors or
administrators of Executive's estate, as appropriate.
(e) Severability. If any provision of this Agreement is held
to be illegal, invalid or unenforceable under existing or future laws
effective during the term of this Agreement, such provisions shall be
fully severable, the Agreement shall be construed and enforced as if
such illegal, invalid or unenforceable provision had never comprised a
part of this Agreement, and the remaining provisions of this Agreement
shall remain in full force and effect and shall not be affected by the
illegal, invalid or unenforceable provision or by its severance from
this Agreement. Furthermore, in lieu of such illegal, invalid or
unenforceable provision, there shall be added automatically as part of
this Agreement a provision as similar in terms to such illegal, invalid
or unenforceable provision as may be possible and be legal, valid and
enforceable.
(f) Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter
hereof and thereof and supersedes all prior agreements and
understandings, both written and oral, between the Company and
Executive with respect to the subject matter hereof and thereof.
(g) Assignment. This Agreement and the rights and duties
hereunder are not assignable by Executive. This Agreement and the
rights and duties hereunder may not be assigned by the Company without
the express written consent of Executive (which consent may be granted
or withheld in the sole discretion of Executive), except that such
consent shall not be required in order for the Company to assign this
Agreement or the rights or duties hereunder to an affiliate (as such
term is defined in Section 9(b)) of the Company or to a third party in
connection with the merger or consolidation
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of the Company with, or the sale of all or substantially all of the
assets or business of the Company to, that third party.
(h) Amendment; Waiver. This Agreement may not be amended or
modified except by an instrument in writing signed by, or on behalf of,
the Company and Executive. Either party to this Agreement may (a)
extend the time for the performance of any of the obligations or other
acts of the other party or (b) waive compliance with any of the
agreements or conditions of the other party contained herein. Any such
extension or waiver shall be valid only if set forth in an instrument
in writing signed by the party to be bound thereby. Any waiver of any
term or condition shall not be construed as a waiver of any subsequent
breach or a subsequent waiver of the same term or condition, or a
waiver of any other term or condition, of this Agreement. The failure
of any party to assert any of its rights hereunder shall not constitute
a waiver of any such rights.
(i) Governing Law. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of
Illinois, applicable to contracts executed in and to be
performed entirely within that state.
(j) Jurisdiction and Venue. The parties hereto agree that all
actions or proceedings initiated by either party hereto and arising
directly or indirectly out of this Agreement which are brought pursuant
to judicial proceedings shall be litigated in a Federal or state court
located in the State of California. The parties hereto expressly submit
and consent in advance to such jurisdiction and agree that service of
summons and complaint or other process or papers may be made by
registered or certified mail addressed to the relevant party at the
address to which notices are to be sent pursuant to Section 11(b) of
this Agreement. The parties hereto waive any claim that a Federal or
state court located in the State of California is an inconvenient forum
or an improper forum based on lack of venue.
(k) Equitable Relief. Executive acknowledges that the
covenants contained in Sections 9 and 10 are reasonable and necessary
to protect the legitimate interests of the Company, that in the absence
of such covenants the Company would not have entered into this
Agreement, that any breach or threatened breach of such covenants will
result in irreparable injury to the Company and that the remedy at law
for such breach or threatened breach would be inadequate. Accordingly,
the Executive agrees that the Company, in addition to any other rights
or remedies which it may have, shall be entitled to seek such equitable
and injunctive relief as may be available from any court of competent
jurisdiction to restrain
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the Executive from any breach or threatened breach of such
covenants.
(l) Attorneys' Fees. If any legal action or other proceeding
is brought for the enforcement of this Agreement, the prevailing party
shall be entitled to recover reasonable attorneys' fees and other costs
incurred in that action or proceeding, in addition to any other relief
to which it may be entitled.
(m) Counterparts. This Agreement may be executed in one or
more counterparts, and by the parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original while all
of which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and Executive have executed this
Agreement as of the date and year first written above.
TICKETMASTER CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
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Title: President
/s/ Xxxxx Xxxxxx
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XXXXX XXXXXX
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