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EXHIBIT 10.11
CONSULTING AGREEMENT
CONSULTING AGREEMENT dated as of March 8, 1999 between
TELE-COMMUNICATIONS, INC., a Delaware corporation (the "Company"), and XXXXX X.
XXXXXXX, now residing at (*Address Redacted*) ("Consultant").
Effective as of the date hereof, the Company has accepted
Consultant's resignation as an officer and employee of the Company, its
subsidiaries and its other controlled affiliates. In order to continue to have
available the benefit of Consultant's knowledge of the Company and expertise,
the Company wishes to retain Consultant to provide consulting services on the
terms set forth herein, and Consultant has agreed to provide such services on
such terms. The Company and Consultant also desire to memorialize their
agreement concerning certain continuing rights and obligations under certain
other compensatory agreements.
In consideration of the mutual covenants and agreements herein
contained and for other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the parties, intending to be
legally bound, do hereby agree as follows:
1. Term and Termination.
(a) Term. The term of Consultant's retention under this
Agreement (the "Term") shall commence on the date hereof and shall end
on December 31, 2007. During the Term, Consultant agrees to serve the
Company as a consultant upon and subject to the terms and conditions
set forth in this Agreement. The Company acknowledges that its
obligations under Sections 5, 6 and 7 hereof shall survive any
termination of Consultant's retention as a consultant under this
Agreement.
(b) Termination by the Company. Consultant's retention by the
Company as a consultant under this Agreement may be terminated by the
Company only as provided in clauses (i) and (ii) below.
(i) Upon the death of Consultant. The Company shall,
as promptly as practicable following Consultant's death, pay
to Consultant's designated beneficiary or beneficiaries in a
lump sum an amount equal to one year's compensation under
Section 4(a) of this Agreement. The phrase ?designated
beneficiary or beneficiaries' shall mean the person or persons
named by Consultant from time to time in a signed designation
filed with the Company from time to time.
(ii) Upon giving written notice of such termination
to Consultant six (6) months prior to the effective date
thereof and by paying to Consultant in a lump sum
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upon such termination all remaining compensation that would
have been payable under Section 4(a) hereof if this
Agreement remained in full force and effect for the full
balance of the Term.
2. Services to be Rendered by Consultant.
(a) During the Term, Consultant shall, upon the request of the
Company's Chief Executive Officer (the "CEO"), consult with and advise
the Company with respect to issues and matters of the general types for
which Consultant had responsibility as an officer of the Company during
calendar year 1998. If Consultant, with his consent, is elected or
appointed as a director of the Company or any of the Company's
affiliates, Consultant will serve in each such capacity without further
compensation, except as may be decided by the Company or such affiliate
in its sole discretion. The Company acknowledges that Consultant is a
director of Liberty Media Corporation, its successors and assigns
("Liberty"), each of the Covered Entities (as defined in the
Inter-Group Agreement (as defined below)) and certain of their
respective affiliates and that, in accordance with the Inter-Group
Agreement between AT&T Corp. ("AT&T") and Liberty, to be dated as of
March 9, 1999 (the "Inter-Group Agreement"), Consultant shall have no
duty to communicate, present, make available, or offer to the Company
any business or other corporate opportunities obtained or presented to
Consultant in his capacity as a director of Liberty, any Covered Entity
or any of their respective affiliates.
(b) Consultant is agreeing to and shall provide his services
under this Agreement as an independent contractor, and neither this
Agreement nor the provision of Consultant's services hereunder is
intended to create any partnership, joint venture or employment
relationship between Consultant and the Company or any of its
affiliates.
3. Time to be Devoted by Consultant; Support by the Company;
Location of Services.
(a) Consultant shall not be obligated to make available
consulting services to the Company of more than 70 hours during any
month or more than 700 hours during any period of 12 consecutive
months. The actual times during which Consultant performs consulting
services shall be mutually agreed by Consultant and the CEO, and the
Company will, whenever practicable, give Consultant at least 15 days
prior notice of any request by the Company for any consulting services;
provided, that Consultant will not be required to render consulting
services hereunder prior to 9:00 a.m. local time or after 8:00 p.m.
local time. Unless otherwise agreed by the Company and Consultant, the
Company will in good faith endeavor to spread the time required of
Consultant relatively evenly throughout the Term, recognizing that
Consultant may not be available for certain periods of time or may
agree (but will not be obligated) to spend concentrated amounts of time
on specific projects during certain periods during the Term. It is
expressly acknowledged by the Company that the relationship between the
Company and Consultant created by this Agreement is non-exclusive, and
nothing set forth in this Agreement shall prohibit or restrict
Consultant during or after the Term hereof from engaging in any
business or activities in any capacity on
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behalf of any other person, except as specifically set forth in
Section 8, 9 or 11 hereof. As such, the Company and Consultant will
work together in good faith to schedule the performance of
Consultant's services hereunder so as not to unreasonably interfere
with any such other business or activities.
(b) During the Term, the Company shall, at the Company's
expense, provide Consultant with all office space, facilities,
equipment, supplies, services and secretarial and other staff support
which Consultant reasonably requires in order to provide consulting
services hereunder.
(c) Consultant may perform his services hereunder in any
location which he deems to be appropriate and consistent with the needs
of the Company, including the home of Consultant.
4. Compensation Payable to Consultant.
(a) During the Term, the Company shall pay Consultant
compensation at the rate of $610,000 per annum. Consultant shall be
entitled to such compensation whether or not any service are requested
of him and regardless of the number of hours of such service that may
be rendered during any particular period.
(b) Consultant's annual compensation shall be paid to
Consultant in accordance with the Company's regular payroll policy for
executives, but not less frequently than once a month.
(c) The Company shall not withhold taxes from any payments due
to Consultant, except to the extent required by mandatory provisions of
applicable law.
5. Expenses. The Company shall reimburse Consultant for the
reasonable amount of dining, hotel, traveling, entertainment and other expenses
(consistent with the Company's reimbursement standards for its most senior
officers) necessarily incurred by Consultant in the discharge of his consulting
obligations hereunder.
6. Executive Benefit Plans. During the Term, Consultant shall be
entitled to participate in and to be accorded all rights and benefits under all
group insurance policies maintained or established by the Company for the
benefit of its employees, and for this purpose Consultant shall be deemed to be
a full-time employee of the Company during such period. In addition, during the
Term Consultant shall be entitled to free cable television service if Consultant
has residences located within areas serviced by the Company's cable television
services. Notwithstanding the foregoing, Consultant shall not be entitled to
participate in any benefit plan of the Company which, under mandatory provisions
of any applicable law, is available only to employees of the Company.
7. Indemnification. The Company will indemnify and hold harmless
Consultant, to the fullest extent permitted by applicable law, in respect of any
liability, damage, cost or expense
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(including reasonable counsel fees) incurred in connection with the defense of
any claim, action, suit or proceeding to which he is a party, or threat thereof,
by reason of his being or having been an officer, director, employee, consultant
or agent of the Company or any subsidiary of the Company, or his serving or
having served at the request of the Company as a director, officer, employee,
consultant or agent of another corporation or of a partnership, joint venture,
trust, business organization, enterprise or other entity, including service with
respect to employee benefit plans. Without limiting the generality of the
foregoing, the Company will pay the expenses (including reasonable counsel fees)
of defending any such claim, action, suit or proceeding in advance of its final
disposition, upon receipt of an undertaking by Consultant to repay all amounts
advanced if it should ultimately be determined that Consultant is not entitled
to be indemnified under this Section. The parties acknowledge and agree that the
Company shall not be required to provide indemnification to Consultant with
respect to his serving as a director of Liberty, any Covered Entity or their
respective affiliates with respect to service by Consultant on such boards
following the date of closing of AT&T's acquisition of the Company.
8. Noncompetition. Consultant agrees that while retained as a
consultant under this Agreement and for the Applicable Period (as defined below)
following the termination of such retention, he will not, directly or
indirectly, as principal or agent, or in any other capacity, own, manage,
operate, participate in or be employed by or otherwise be interested in, or
connected in any manner with, any person, firm, corporation or other enterprise
which directly competes in a material respect with the business of the Company
or any of its subsidiaries as then conducted. Nothing herein contained shall be
construed as denying Consultant the right to (i) own securities of any such
corporation which is listed on a national securities exchange or quoted in the
NASDAQ System to the extent of an aggregate of 5% of the amount of such
securities outstanding, (ii) provide consultancy services to others which may
violate the provisions of the first sentence of this Section if the Company's
CEO approves in writing of such provision of consultancy services or (iii) serve
as a director on the Boards of Directors of Liberty, any of the Covered
Entities, or their respective affiliates, and to provide services in connection
therewith. For purposes hereof, the term "Applicable Period" means the period
beginning on the effective date of the termination of Consultant's retention
hereunder as a consultant to the Company (the "Effective Date") and ending on
the second anniversary of the Effective Date.
9. Confidentiality. Consultant agrees that while retained
hereunder as a consultant of the Company (otherwise than in the performance of
his duties hereunder) and thereafter, not to, directly or indirectly, make use
of, or divulge to any person, firm, corporation, entity or business organization
and he shall use his best efforts to prevent the publication or disclosure of,
any confidential or proprietary information concerning the business, accounts or
finances of, or any of the methods of doing business used by the Company or of
the dealings, transactions or affairs of the Company or any of its customers
which have or which may have come to his knowledge during his retention with the
Company or period of retention as a consultant hereunder, but this Section 9
shall not prevent Consultant from responding to any subpoena, court order or
threat of other legal duress, provided Consultant notifies the Company thereof
with reasonable promptness so that the Company may seek a protective order or
other appropriate relief, but this Section 9 shall not prevent Consultant from
responding to any subpoena, court order or threat of other legal duress,
provided Consultant notifies
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the Company hereof with reasonable promptness so that the Company may seek a
protective order or other appropriate relief.
10. Delivery of Materials. Consultant agrees that, upon the
termination of his period of retention as a consultant hereunder, he will
deliver to the Company all documents, papers, materials and other property of
the Company relating to its affairs, which may then be in his possession or
under his control.
11. Noninterference. Consultant agrees that he will not, while
retained as a consultant hereunder and for the Applicable Period following the
termination of his period of retention as a consultant hereunder, solicit the
employment of any employee of the Company on behalf of any other person, firm,
corporation, entity or business organization, or otherwise materially interfere
with the employment relationship between any employee or officer of the Company
and the Company.
12. Effect on Equity Agreements. The Company hereby agrees that,
notwithstanding any provision of any options to acquire capital stock of the
Company, stock appreciation rights, restricted stock awards or other equity
incentive award ("Equity Award"), in each case granted to Consultant by the
Company or any of its subsidiaries, or any provision of any employee benefit
plan under which such Equity Award was granted, to the contrary, (a) none of
such Equity Awards currently held by Consultant shall terminate or otherwise be
affected by the resignation of Consultant as an officer and employee of the
Company and (b) all such Equity Awards which by their terms are not currently
exercisable shall continue to vest and become exercisable in accordance with
their terms, unless or until they expire or otherwise terminate in accordance
with their terms (other than by reason of Consultant's resignation as an officer
and employee of the Company).
13. Remedies. Consultant agrees that, in the event of a material
breach by Consultant of this Agreement, in addition to any other rights that the
Company may have pursuant to this Agreement, the Company shall be entitled, if
it so elects, to institute and prosecute proceedings, at law or in equity, to
obtain damages with respect to such breach or to enforce the specific
performance of this Agreement by Consultant or to enjoin Consultant from
engaging in any activity in violation hereof. Consultant agrees that because
Consultant's services to the Company are of such a unique and extraordinary
character, a suit at law may be an inadequate remedy with respect to a breach by
Consultant of Sections 8, 9, 10 and 11 hereof, and that upon any such breach or
threatened breach by him of such Sections the Company shall be entitled, in
addition to any other lawful remedies that may be available to it, to injunctive
relief. In the event of a breach by the Company of this Agreement (which is not
cured within 30 days from the date of notice of such breach), Consultant may
declare that the Company has terminated Consultant pursuant to Section 1(b)(ii)
hereof, and Consultant shall be entitled to the benefits and remedies as a
result of such deemed termination.
14. Notices. All notices to be given hereunder shall be deemed
duly given when delivered personally in writing or mailed, certified mail,
return receipt requested, postage prepaid and addressed as follows:
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(a) If to be given to the Company:
Tele-Communications, Inc.
0000 XXX Xxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
with a copy similarly addressed
and marked to the attention of
the Legal Department
(b) If to be given to Consultant:
Xx. Xxxxx X. Xxxxxxx
(* Address Redacted*)
or to such other address as a party may request by notice given in accordance
with this Section 14.
15. Miscellaneous. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and replaces and
supersedes as of the date hereof any and all prior agreements and understandings
with respect to Consultant's employment and/or retention as a consultant by the
Company, whether oral or written, between the parties hereto, including, without
limitation, that certain Employment Agreement between Consultant and the Company
dated as of January 1, 1998. This Agreement may not be changed nor may any
provision hereof be waived except by an instrument in writing duly signed by the
party to be charged. This Agreement shall be interpreted, governed and
controlled by the law of the State of Colorado, without reference to principles
of conflict of laws. Notwithstanding anything to the contrary set forth herein,
the Company's rights hereunder shall be subject, in all respects, to
Consultant's rights as a director of Liberty, each Covered Entity, and certain
of their respective affiliates, as provided in the Inter-Group Agreement.
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IN WITNESS WHEREOF, this Agreement has been executed as of the day and
year first above written.
TELE-COMMUNICATIONS, INC.
By:
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Name:
Title:
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Xxxxx X. Xxxxxxx
