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Exhibit 10.27
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made and entered into as of
the 6th day of January, 1997 (the "Commencement Date"), by and between SPELLING
ENTERTAINMENT GROUP INC., a Delaware corporation ("Employer"), and XXXXX XXXXXX
("Employee"). The parties agree to the following:
1. Duties
Employer engages Employee to serve in the capacity of Vice
President and Controller, reporting to the Senior Vice President and Chief
Financial Officer of Employer, or such other persons as Employer may later
designate. During the term of this Agreement, Employee shall perform the duties
and responsibilities as shall from time to time, be reasonably delegated or
assigned to Employee by Employer.
2. Employment Term
2.1 Employment of Employee. Subject to the termination
provisions of this Agreement, Employer hereby employs Employee under the terms
and conditions set forth in this Agreement for a period of two (2) years,
commencing on the Commencement Date and terminating on January 5, 1999 (the
"Employment Term") with an option by Employer to renew for a third year
commencing January 6, 1999 and terminating on January 5, 2000 (the "Option
Term"). Employer shall provide to Employee written notice no later than 90 days
prior to the termination date of the Employment Term as to whether or not
Employer intends to exercise the Option Term. The Employment Term and Option
Term (if any) are hereinafter referred to collectively as the "Term."
2.2 Employment Relationship. Employee and Employer acknowledge
and agree that neither has any obligation or duty to renew, extend or negotiate
for the renewal or extension of the employment relationship beyond the
Employment Term. Should the employment relationship continue after the
Employment Term without a new employment contract, the employment during such
period shall be at will, so that either Employer or Employee may terminate the
employment at any time.
3. Compensation
3.1 Base Salary. As compensation for the performance of
Employee's obligations hereunder, Employer shall pay Employee a base salary
("Base Salary") during the Employment Term as follows:
$160,000 during the first year of the Employment Term;
$175,000 during the second year of the Employment Term; and
$190,000 during the Option Term, if any.
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All compensation under this section shall be payable in accordance with
Employer's normal practices.
3.2 Bonus Compensation. Employee shall be eligible, at
Employer's sole discretion, to receive bonus compensation. The amount of such
bonus compensation, if any, shall be determined in accordance with the policies
used in determining the bonus compensation of employees of similar stature.
4. Benefits
4.1 Expenses. Employer agrees to pay or reimburse Employee for
reasonable and necessary business expenses in accordance with Employer's general
policies for employees of similar stature.
4.2 Medical, Insurance and Other Benefits. During the
Employment Term, Employee shall be entitled to participate in all benefit plans
available to other employees of Employer of similar stature, including, without
limitation, any stock option plan (together with applicable option, vesting,
exercise and termination provisions), or group medical, dental or disability
benefits, as such plans or benefits may be established or modified from time to
time in Employer's sole discretion.
4.3 Stock Options. Subject to approval by Employer's Board of
Directors, and approval by the shareholders of Employer at its 1997 Annual
Meeting of Shareholders, Employee shall be granted 10,000 stock options to
purchase common stock of Spelling Entertainment Group Inc. ("SEGI"), at a
purchase price equal to the closing price on January 6, 1997, in accordance with
the terms of the SEGI Stock Option Plan. These options shall vest in four (4)
equal annual installments commencing January 6, 1998. Vesting shall cease upon
termination of Employee's employment, and Employee's right to exercise stock
options shall cease after termination of Employee's employment for any reason in
accordance with the terms of the SEGI Stock Option Plan. Employee acknowledges
and agrees that the vesting periods referred to herein do not expressly or
impliedly constitute a promise or representation concerning an extension or
continuation of the employment relationship beyond the Employment Term.
4.4 Vacation. During the Employment Term, Employee shall be
entitled to three (3) weeks vacation per year, in accordance with the policies
established from time to time by Employer.
4.5 Car Allowance. During the Employment Term, Employee shall
receive a car allowance in the amount of $350 per month.
4.6 Pension. Employee shall be eligible to participate in
Employer's 401(k) plan offered to its employees, on the same terms and
conditions applicable to all employees of similar stature under the plan.
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5. Termination For "Cause"
Employer may terminate Employee's employment for "cause" as
defined in this Section at any time upon written notice to Employee. As used
herein, the term "cause" shall mean any one or combination of the following:
(i) Employee's conviction of any crime (whether or not
involving Employer) which constitutes a crime of moral turpitude or is
punishable by imprisonment of one year or more.
(ii) Any act or omission by Employee involving malfeasance or
negligence, or constituting a material breach of this Agreement.
(iii) Employee's omission or act constituting fraud,
dishonesty or misrepresentation, whether prior or subsequent to the date
hereof, including, without limitation any fraud, dishonesty or
misrepresentation relating to Employee's hiring by Employer.
(iv) Employee's failure, inability (which does not qualify as
a disability under federal or state law), or refusal to perform
Employee's duties on an exclusive and full-time basis.
(v) Employee's violation of any material rule or regulation
of Employer applicable to other employees of similar stature.
6. Mitigation
If Employee's employment is terminated by Employer without
cause, as "cause" is defined in Section 5 hereof, Employer shall, except as
otherwise provided below, pay to Employee the compensation described in Section
3.1 for the balance of the Employment Term. However, Employee shall have the
obligation to use good faith and best efforts to seek alternative employment.
Employer shall be entitled to reduce the amount of any compensation and
applicable benefits payable to Employee under this Agreement by the amount of
salary, bonus and/or benefits or other compensation of any kind earned or
received by Employee from any third party and/or any such amounts, compensation
or benefits earned through self employment from the date of termination through
the end of the Employment Term.
7. Confidentiality
7.1 Non-Disclosure of Company Information. During the term
of Employee's employment and thereafter, Employee shall keep in confidence and
shall not use for Employee or others, or divulge to others, any information
pertaining to the business of Employer or its affiliates
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including, without limitation, secret or confidential information, knowledge,
data or plans of Employer or its affiliates, including, without limitation,
matters of a business nature such as information about costs and profits,
projections, personnel information, records, customer lists, contact persons,
customer data, software, sales data, or matters of a creative nature, including
without limitation, matters regarding ideas of a literary or dramatic nature,
or regarding any form of motion pictures or television product ("Company
Information"). Company Information shall be considered and kept as the private,
proprietary and confidential information of Employer and may not be divulged
without the express written authorization of Employer.
7.2 Return of Records. All records, files, lists, drawings,
documents, models, equipment, software or intellectual property relating to
Employer's business shall be returned to Employer upon the termination of
Employee's employment.
7.3 Irreparable Harm. Employee acknowledges and agrees that
any breach of this provision could cause irreparable harm to Employer, and
would entitle Employer to enjoin unauthorized disclosure of Company Information.
8. Conflict of Interest
8.1 Restriction on Use of Title. Employee shall not use, or
allow the use of, Employee's title or the fact of Employee's employment or
affiliation with Employer or any of its affiliates in connection with any
activities or endeavors which are not directly related to the performance of
Employee's duties under this Agreement without the prior written approval of
Employer.
8.2 Investment Limitation. Employee shall not become
financially interested in, or associated with, directly or indirectly, any
third party in connection with the production, distribution or exhibition of
motion pictures, television programs, sound recordings, theatrical plays, any
visual and/or audio recordings of any kind, or any other entertainment related
business or activity without the prior written approval of Employer; provided,
however, that this provision shall not prevent Employee from (i) holding a
passive or beneficial interest in any third party which is not a competitor of
Employer or any of its affiliates or (ii) holding a passive or beneficial
interest not exceeding one percent (1%) of the outstanding stock of any
publicly traded corporation whether or not such publicly traded corporation
competes with Employer or any of its affiliates.
9. No Solicitation of Employees
Employee shall not during the term of this Agreement or for a
period of one year thereafter induce or attempt to induce any employees or
representatives of Employer (or those of any of its affiliates) to stop working
for or representing Employer or any of its affiliates in order to work for or
represent any of the Employer's competitors. The provisions of this Section
shall survive the expiration, termination or rescission of this Agreement.
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10. Ownership of Intellectual Property
10.1 Agreement to Transfer Intellectual Property. Employer
shall own, and Employee hereby transfers and assigns to it, all rights, of
every kind and character throughout the world, in perpetuity, in and to any
material or ideas and all results and proceeds of Employee's services
hereunder, or conceived of or produced during the term of Employee's
employment, whether the same consists of literary, dramatic, musical, motion
picture, mechanical, or any other form of works, themes, ideas, inventions,
creations, products or compositions.
10.2 Execution of Assignment Documents. Employee agrees to
execute and deliver to Employer such assignments, certificates of authorship,
or other instruments in accordance with standard industry practice as Employer
may require from time to time to evidence ownership of the results and proceeds
of Employee's services. Employee's agreement to assign to Employer any of
Employee's rights as set forth in this Section does not apply to any invention
which qualifies fully as Employee's invention under the provisions of Section
2870 of the California Labor Code, where no equipment, supplies, facility, or
trade secret information of Employer was used and which was developed entirely
upon Employee's own time, and which (i) does not relate to the business of
Employer or to its actual or demonstrably anticipated research or development,
or (ii) which does not result from any work performed by Employee for Employer.
10.3 Status of Ownership of Copyrights. Employee represents
and warrants that except as previously disclosed to Employer in writing,
Employee neither owns nor controls any copyrights, literary rights, contract
rights, or other rights in any literary, dramatic work, musical work or any
concept or idea which could be the basis for a television program, feature
film, video or other motion picture or copyrightable product.
11. Exclusive Services
Employee agrees not to perform services of any kind or nature
which would interfere with the performance of Employee's services hereunder for
any third party or render services for Employee's own account which would
interfere with the performance of Employee's services hereunder.
12. Unique Personal Services
Employee agrees and acknowledges that Employee's personal
services are of a special, unique, unusual, extraordinary, and intellectual
character giving them a peculiar value, the loss of which Employer cannot be
reasonably compensated for in damages in an action at law. Therefore, in the
event of the breach by Employee of this Agreement, Employer shall,
notwithstanding the provisions of Section 21 below, be entitled to make
application to a court of competent jurisdiction for equitable relief by way of
injunction or otherwise. This provision shall not be construed as a waiver of
any of the rights which Employer may have for damages under this Agreement or
otherwise, and all of Employer's rights and remedies shall be unrestricted.
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13. Acknowledgement of Section 508
Employee acknowledges that Employee is familiar with the
requirements of Section 508 of the Federal Communications Act (regarding the
acceptance or payment of money or other consideration for the inclusion of
program matter), is aware that the violation of Section 508 constitutes a
criminal offense, has not violated and will not violate any of the provisions
of Section 508, and has not and will not do any act which would require
disclosure pursuant to Section 508.
14. Disability
If Employee becomes "Materially Disabled" (as defined in this
Section) during the Employment Term, Employer may, at its election, terminate
this Agreement, except that Employee's obligations under Sections 6, 7, 9 and
10 of this Agreement shall survive any such termination. "Materially Disabled"
shall mean any instance where Employee becomes unable, as a result of a serious
health condition (other than a pregnancy-related disability), to render full
services as contemplated by this Agreement for any period totalling more than
twelve (12) weeks in the aggregate during any twelve (12) month period.
15. Death
In the event of Employee's death, this Agreement shall
terminate, and Employer shall thereupon be released and discharged from all
further obligations under this Agreement, except for any vested benefits and
earned and unpaid earned Base Salary for time worked.
16. Complete Agreement
16.1 No Other Agreements. This Agreement is the product of
negotiation between the parties hereto and supersedes all prior agreements, if
any, between Employer and Employee, and constitutes the entire agreement
between the parties.
16.2 Modification or Amendment. No amendment or modification
of this Agreement shall be valid or binding unless it is in writing and duly
executed by Employer.
16.3 No Third Party Representations. Employee acknowledges
that no person has made any representation or promise on behalf of Employer not
set forth herein and this Agreement has not been executed in reliance upon any
such representation or promise.
17. Severable Agreement
If any provision of this Agreement is declared invalid,
illegal, or incapable of being enforced, all of the remaining provisions of
this Agreement shall nevertheless continue in full force and effect.
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18. Notices
Any notice required or desired to be given to Employer or to
Employee shall be given in writing, and shall be addressed:
To Employer:
Spelling Entertainment Group Inc.
0000 Xxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx, Senior Vice President,
General Counsel and Secretary
To Employee:
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Notices given under this Section shall be given by hand delivery, telecopy,
registered mail or overnight courier.
19. Assignment.
Employer shall have the right to assign this Agreement to any
subsidiary or affiliate or successor of Employer.
20. Employer's Affiliated Corporations
20.1 Employee acknowledges and agrees that all of Employee's
covenants and obligations to Employer, as well as the rights of Employer
hereunder, shall run in favor of and shall be enforceable by the parent,
subsidiary and affiliated companies of Employer.
20.2 Employee acknowledges that notwithstanding references in
this Agreement to the parent, subsidiary and affiliated companies of Employer,
this Agreement is between Employee and Employer and there are no other parties
to this Agreement. Employee shall have no right to enforce this Agreement
against SEGI or any other parent, subsidiary and affiliated companies of
Employer unless this Agreement is assigned to any such entity in accordance
with the provisions of paragraph 19 hereof.
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21. Alternative Dispute Resolution
21.1 Binding Arbitration. Except for Employer's right to seek
equitable relief in accordance with the provisions of Sections 7, 9, and 12 of
this Agreement, the parties agree that all disputes, claims and other matters
in controversy arising out of or relating to this Agreement, or the
performance or breach thereof, shall be submitted to binding arbitration in
accordance with the provisions and procedures of this Section.
21.2 Arbitrator/Place of Arbitration. The arbitration provided
for in this paragraph shall take place in Los Angeles County, California, in
accordance with the provisions of Title 9, Sections 1280 et seq of the
California Code of Civil Procedure ("CCP"), except as provided to the contrary
hereunder. The arbitration shall be held before and decided by a single neutral
arbitrator. The single neutral arbitrator shall be selected from a list of
retired judges of the Superior Court of the State of California for the County
of Los Angeles by a process mutually agreed upon by the parties. If no
agreement can be reached as to the process for selecting the arbitrator or if
the agreed method fails, the arbitrator shall be appointed in accordance with
the provisions of CCP Section 1281.6
21.3 Arbitration Procedures
(a) Time and Place for Hearing. The parties shall mutually
agree upon the date and location of the arbitration, subject to the
availability of the arbitrator. If no agreement can be reached as to the date
and location of the arbitration, the arbitrator shall appoint a time and place
in accordance with the provisions of CCP Section 1282.2(a)(1), except that the
arbitrator shall give not less than 30 days notice of the hearing unless the
parties mutually agree to shorten time for notice.
(b) Discovery. The parties shall be entitled to undertake
discovery in the arbitration in accordance with the provisions of subsections
(a) through (d) of CCP Section 1283.05. In conjunction with these procedures,
the parties shall be entitled to request and obtain production of documents in
discovery in the arbitration in accordance with the same rights, remedies and
procedures, and shall be subject to all of the same duties, liabilities and
obligations as if the subject matter of the arbitration were pending in a
civil action before a Superior Court of the State of California. The parties
hereby agree that any discovery taken hereunder shall be permitted without
first securing leave of the arbitrator and shall be kept to a reasonable
minimum.
(c) Award Final. The decision of the arbitrator may be
confirmed pursuant to the provisions of CCP Section 1285, and shall not be
appealable for any reason, it being understood that a petition to vacate an
award for any of the reasons set forth in CCP Section 1286.2 shall not be
permitted.
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22. Counterparts
This Agreement may be executed in counterparts, each of which,
when so executed, shall be deemed an original, but all of which together shall
constitute one and the same instrument.
23. Governing Law
This Agreement shall be deemed made in the State of California,
County of Los Angeles, and shall be governed by the laws of the State of
California.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
SPELLING ENTERTAINMENT GROUP, INC.
(Employer)
By: /s/ Xxxxx X. Xxxxxxxx
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Its: Executive Vice President
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XXXXX XXXXXX
(Employee)
/s/ Xxxxx Xxxxxx
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