MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT (the "Agreement") is entered into between
XXXXXX X. XXXXXX, an individual residing in the State of Missouri ("Koplar"),
and ACME TELEVISION LICENSES OF MISSOURI, INC., a Missouri corporation ("Acme").
RECITALS
X. Xxxxxx has for years been the chief executive and operating officer
for television broadcast station KPLR-TV, Channel 11 in St. Louis, Missouri (the
"Station").
B. Acme (either directly or through subsidiary entities) is the owner
and operator of television broadcast stations which are affiliates of the WB
Network.
X. Xxxxxx desires to provide, and Acme desires to obtain, Koplar's
management services for the Station pursuant to and in accordance with the terms
and conditions of this Agreement ("Company Services").
NOW, THEREFORE, in consideration of the mutual promises of the
parties, the parties hereto, intending to be legally bound, agree as follows:
1. Scope of Company Services. During the Initial Term (as defined
below) and any Renewal Term (as defined below), unless earlier terminated,
Koplar shall be the Chief Executive Officer of the entity ("Company") owning or
operating the Station and shall, as directed by the Company's Board of
Directors, be responsible for the management of the operations of the Station
except as otherwise described herein. The autonomy and scope of the authority of
Koplar in the management of the Station will be subject to approval by the Board
of Directors regarding annual budgets, business plans, material contracts and
material financial arrangements normally requiring Board approval. As Chief
Executive Officer, Koplar shall have all of the powers normally attendant to an
individual who holds that position, subject to the terms hereof Koplar shall
continue to be involved in the same range of the Station's operations as he was
prior to the change of ownership of the Station. Acme and Koplar shall jointly
agree on the hiring and/or termination of the Station's General Manager. In
addition, Koplar shall be a Vice Chairman and serve as a member of Acme's Board
of Advisors or substitute entity having similar authority (in either case, the
"Board of Advisors"). At all times Koplar shall have twenty-five percent (25%)
of the combined voting rights of Koplar, Xxxx Xxxxx, Xxx Xxxxx and Xxxxx
Xxxxxxx, or their respective successors, provided, however, Koplar's right to be
a member of the Board of Advisors shall terminate upon a Voting Event as defined
in the Limited Liability Company Operating Agreement dated June 17, 1997,
provided that the primary purpose for such Voting Event is not to remove Koplar
as a member of the Board of Advisors. Koplar's position as Vice Chairman and
member of Acme's Board of Advisors shall continue for so long as
Koplar or a trust in which Koplar is a trustee is an investor in Acme and shall
survive any termination of this Agreement.
2. Time Requirements. Notwithstanding anything to the contrary
contained in this Agreement, it is the intent of the parties that Koplar shall
determine, in his reasonable judgment, the amount of time necessary to perform
the Company Services pursuant to this Agreement, and shall devote that amount of
time necessary and appropriate to performing the Company Services. Koplar and
Acme acknowledge that Koplar will be a vice president and a director (or the
equivalent) of the Company.
3. Consulting Fee.
a. In consideration for the Company Services to be provided by
Koplar under this Agreement, Acme shall pay Koplar a fee of One Million and No/
I 00 Dollars ($1,000,000) per year in regular installments ("Consulting Fee")
provided that during the first year of the Initial Term, which initial year
shall expire on September 30, 1998, this Consulting Fee shall be reduced by all
monies paid to Koplar, the sum of which is listed on Schedule I hereto, pursuant
to the Time Brokerage Agreement, dated September 8, 1997, by and among Koplar
Communications, Inc., Koplar Communications Television, L.L.C., Acme and ACME
Television Holdings, L.L.C. Acme shall provide employee benefits to Koplar
similar to those provided to him prior to the effective date of this Agreement.
The cost of such employee benefits for Koplar, including without limitation,
health insurance and other insurance, shall reduce the amount of the Consulting
Fee.
b. In addition to paying the Consulting Fee as provided in a. above,
the Company shall provide Koplar with the following which shall not reduce the
Consulting Fee:
i. Reimbursement for reasonable business expenses (including, but
not limited to, travel and entertainment expenses) incurred by Koplar in
performing the Company Services;
ii. x (6) tickets to at least 25 Cardinals regular season home
baseball games using all the seats presently owned by the Company located behind
home plate ("Home Plate Seats");
iii. Six (6) tickets to at least four (4) Cardinals post season
home baseball games (consisting of at least two (2) playoff and two (2) World
Series games) using the Home Plate Seats (if the Cardinals are in the playoffs
and/or the World Series)-,
iv. Tickets to at least 15 Blues regular season home hockey games
using at least six (6) tickets in the luxury box leased by the Company ("Luxury
Box Seats");
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v. Tickets to at least two (2) Blues post season games in each
round of the playoffs in which the Blues participate (including the Xxxxxxx Cup)
using the Luxury Box Seats;
vi. A full time secretary selected by Koplar in his sole
discretion, at a reasonable salary; and
vii. Office space located in the Station's headquarters in St.
Louis, Missouri, that is substantially similar in size, quality, and location as
the office space used by Koplar immediately prior to the Commencement Date.
4. Term.
a. Initial Term. The initial term (the "Initial Term") of the
Company Services provided for in this Agreement shall commence as of the closing
of the purchase by Acme of all the issued and outstanding shares of Stock of the
Company (the "Commencement Date") and shall expire on September 30, 2000
("Scheduled Termination Date"), unless other-wise renewed or terminated.
b. Renewal Term(s). The provisions with respect to the Company
Services provided for in this Agreement shall automatically be renewed after the
Initial Term for successive one year terms (each, a "Renewal Term") unless
either party hereto gives the other party written notice of the termination of
this Agreement at least ninety (90) days prior to the end of the Initial Term or
any effective Renewal Term.
x. Xxxxxx Voluntary Termination. Koplar shall have the right, in
his sole discretion, to terminate the provisions regarding the Company Services
set forth in this Agreement. He may do so by giving Acme written notice of his
intent to do so, effective six (6) months after Acme's receipt of such notice.
Acme may, in its sole discretion, and at any time after such notice from Koplar,
accelerate the effective date of the termination by giving Koplar written notice
of such acceleration. In the event that Koplar exercises his right hereunder to
terminate the Company Services aspects of this Agreement, he shall, nonetheless,
be paid the unpaid and uncommitted (e.g., for benefits for Koplar) balance of
his Consulting Fee upon the effective date of such termination.
6. Default.
a. Should either party to this Agreement be in breach of or
default under this Agreement ("Breaching Party") for such Breaching Party's
nonperformance of a material obligation arising under this Agreement, this
Agreement may be terminated by the other party if such breach shall have
continued for a period of fifteen (I 5) days following the receipt of written
notice by the Breaching Party ("Cure Period") which notice shall indicate the
nature of such
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breach or default; provided, however, that there shall be a final accounting of
monies due but unpaid to Koplar under this Agreement.
b. Notwithstanding anything to the contrary contained herein, in
the event that Acme is the Breaching Party and does not cure its default or
breach within the Cure Period, Koplar may terminate this Agreement for cause.
Upon such termination for cause, Acme shall immediately pay Koplar as his sole
and exclusive remedy for such breach:
i. The balance of the Consulting Fee which would have been
payable to Koplar through the remaining portion of the then existing term,
whether Initial or Renewal, had such termination not occurred; and
ii. The amount of $4,000,000, if such termination occurs in
the first year of the Initial Term; the amount of $3,000,000 if such termination
occurs in the second year of the Initial Term; and the amount of $2,000,000 if
such termination occurs in the third year of the Initial Term.
THE PARTIES ACKNOWLEDGE THAT KOPLAR'S ACTUAL DAMAGES UPON DEFAULT BY ACME ARE
DIFFICULT AND IMPRACTICAL TO ESTIMATE. THEREFORE, BY PLACING THEIR INITIALS
BELOW, THE PARTIES EXPRESSLY AGREE THAT THE AMOUNTS SET FORTH IN b.i. AND b.ii.
ABOVE HAVE BEEN AGREED UPON AFTER NEGOTIATION AS THE PARTIES' REASONABLE
ESTIMATE OF KOPLAR'S DAMAGES AND THAT RECEIPT OF SUCH AMOUNTS IS KOPLAR'S
EXCLUSIVE REMEDY AT LAW AND IN EQUITY AGAINST ACME IN THE EVENT OF A DEFAULT BY
ACME.
/s/EJK Koplar /s/DG Acme
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c. Either (a) if, during the term of Koplar's employ hereunder,
the Station or entity owning the Station sells or determines not to continue to
purchase any or all of its Home Plate Seats (apart from a sale of substantially
all the assets of the Station), or (b) in the event of a termination of this
Agreement for any reason, Koplar shall be offered the right to buy the Home
Plate Seats from the Station (either annually, or "one-shot") or directly from
the St. Louis Cardinals, -to the extent such arrangement is consistent with the
policies of the St. Louis Cardinals.
7. Koplar Interactive Systems International, L.L.C. Acme agrees that
any other television stations which it owns and operates will enter into
agreements with Koplar Interactive Systems International, L.L.C. ("KISI"),
granting KISI the right to encode the broadcast signals of such stations with
KISI's interactive technology upon terms substantially similar to those set
forth in the Broadcast Signal Encoding Agreement ("Encoding Agreement") entered
into between Acme and KISI concurrently herewith. The provisions set forth in
this paragraph 7 shall be binding for the term of the Encoding Agreement and any
extensions or renewals thereof and shall remain in effect regardless of any
termination of this Agreement.
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8. Assignability. Koplar acknowledges that Company has entered into
this Agreement in reliance upon the particular reputation and expertise of
Koplar. This Agreement is personal to Koplar and is not assignable by Koplar, in
whole or in part, voluntarily or by operation of law, without the prior written
approval of Acme.
9. Governing Law, No Third Party Rights. This Agreement and any
dispute arising from this Agreement shall be governed by the internal laws of
the State of Missouri, without regard to conflict of law principles. This
Agreement shall not create any rights or benefits to parties other than Acme and
Koplar.
10. Notices. All notices required in writing under this Agreement
shall be considered as having been given by one party to the other party upon
the latter's receipt of the same. All such notices shall be: (i) transmitted by
registered or certified mail, Federal Express or other overnight delivery
service, or by telex, telegram, or facsimile confirmed by a subsequent written
letter; or (ii) by electronic mail, if confirmed by a subsequent written letter
to the party at the address set forth on the signature page of this Agreement or
such other address if either party provides written notice to the other of any
change of address.
11. Severability. If any court of competent jurisdiction determines
that any of the provisions of this Agreement or any part thereof is or are
invalid or unenforceable, the remainder of the provisions shall not thereby be
affected and shall be given full effect, without regard to invalid portions.
12. Non-Waiver. The failure by either party to enforce any provision
of this Agreement shall not be deemed a waiver of such provision or of either
party's right to enforce each and every provision of this Agreement.
13. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their permitted successors and assigns.
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[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first written above.
XXXXXX X. XXXXXX
/s/Xxxxxx X. Xxxxxx
-----------------------------------
An individual
Notice Address:
000 Xxxxx Xxxxxx Xxxx
Xxxxx, XX 00000
ACME TELEVISION HOLDINGS, L.L.C.
By: /s/Xxxxxxx X. Xxxxx
-------------------------------
Name:
------------------------------
Title: President & COO
Notice Address:
00000 Xxxxx Xxxx., Xxxxx 000
Xx. Xxxxx, XX 00000
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