Exhibit 10.4
THIS
AGREEMENT by and between Journal Communications, Inc., a Wisconsin corporation (the
“Company”), and Xxxxxx X. Xxxxx (the “Executive”) was originally made
as of the 8th day of February, 2005, and amended and restated as of January 29, 2007 and
December 8, 2007.
W I T N E S S E T H
T H A T
WHEREAS,
the Company wishes to provide for the employment by the Company of the Executive, and the
Executive wishes to serve the Company and its affiliates, in the capacities and on the
terms and conditions set forth in this Agreement.
NOW,
THEREFORE, it is hereby agreed as follows:
1.
Term of Agreement and Employment Period. The Company shall employ
the Executive, and the Executive shall serve the Company, on the terms and
conditions set forth in this Agreement, commencing on the date of this
Agreement. Unless terminated earlier, as provided in Section 4 hereof, the term
of this Agreement will end on April 10, 2016, the Executive’s 66th birthday.
The Executive’s employment will not terminate solely by virtue of the
expiration of this Agreement, but the rights and obligations of the parties
under this Agreement will cease as of that date unless this Agreement shall
have been extended or renegotiated by mutual agreement of the parties. The term
during which the Executive is employed by the Company hereunder is hereafter
referred to as the “Employment Period.” Notwithstanding the foregoing,
if a Change in Control shall occur within two years prior to the expiration of
the term of this Agreement, the term of this Agreement and the Employment
Period term shall automatically be extended for a period of two years following
the date of the Change of Control. For purpose of this Agreement, the term
“Change in Control” shall mean the occurrence of any of the following
events:
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(a) individuals
who, on the date of this Agreement, constitute the Board of Directors of
the Company (the “Incumbent Directors”) cease for any reason to
constitute at least a majority of such Board, provided that any person
becoming a director after the date of this Agreement and whose election or
nomination for election was approved by a vote of at least a majority of
the Incumbent Directors then on the Board shall be an Incumbent Director;
provided, however, that no individual initially elected or nominated as a
director of the Company as a result of an actual or threatened election
contest with respect to the election or removal of directors (“Election
Contest”) or other actual or threatened solicitation of proxies or
consents by or on behalf of any “Person” (such term for purposes
of this definition being as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934 Act (the “1934 Act”) and as used in Section
13(d)(3) and 14(d)(2) of the 0000 Xxx) other than the Board (“Proxy
Contest”), including by reason of any agreement intended to avoid or
settle any Election Contest or Proxy Contest, shall be deemed an Incumbent
Director; or
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(b) any
Person becomes a “Beneficial Owner” (such term for purposes of
this definition being as defined in Rule 13d-3 under the 1934 Act),
directly or indirectly, of securities of the Company representing 25% or
more of the combined voting power of the Company’s then outstanding
securities eligible to vote for the election of directors (the “Company
Voting Securities”); provided, however, that for purposes of
this subsection (b), the following acquisitions shall not constitute a
Change in Control: (v) an acquisition directly from the Company, (w) an
acquisition by the Company or a Subsidiary of the Company, (x) an
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any Subsidiary of the Company, (y) an
acquisition by a Person who as of December 31, 2006 was a
Beneficial Owner, directly or indirectly, of 15% or more of the Company
Voting Securities, or (z) an acquisition pursuant to a Non-Qualifying
Transaction (as defined in subsection (d) below); or
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(c) any
Person who> as of December 31, 2006 was a Beneficial Owner, directly or
indirectly, of 15% or more of the Company Voting Securities becomes a
Beneficial Owner, directly or indirectly, of 40% or more of the Company
Voting Securities>; provided, however, that for purposes of this
subsection (c), an acquisition directly from the Company shall not
constitute a Change in Control; or
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(d) the
consummation of a reorganization, merger, consolidation, statutory share
exchange or similar form of corporate transaction involving the Company or
a Subsidiary (a “Reorganization”), or the sale or other
disposition of all or substantially all of the Company’s assets (a
“Sale”) or the acquisition of assets or stock of another entity
(an “Acquisition”), unless immediately following such
Reorganization, Sale or Acquisition: (A) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of
the outstanding shares of common stock of the Company (“Company
Common Stock”) and outstanding Company Voting Securities immediately
prior to such Reorganization, Sale or Acquisition beneficially own,
directly or indirectly, more than 50% of, respectively, the then
outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, of the entity resulting from
such Reorganization, Sale or Acquisition (including, without limitation,
an entity which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets or stock either directly or
through one or more subsidiaries, the “Surviving Entity”) in
substantially the same proportions as their ownership, immediately prior
to such Reorganization, Sale or Acquisition, of the outstanding Company
Common Stock and the outstanding Company Voting Securities, as the case
may be, and (B) no Person (other than (w) any Person who as of December 31, 2006
is a Beneficial Owner, directly or indirectly, of 15% or more of the
Company Voting Securities, (x) the Company or any Subsidiary of the
Company, (y) the Surviving Entity or its ultimate parent, or (z) any
employee benefit plan (or related trust) sponsored or maintained by any of
the foregoing) is the beneficial owner, directly or indirectly, of 20% or
more of the total common stock or 20% or more of the total voting power of
the outstanding voting securities eligible to elect directors of the
Surviving Entity, and (C) at least a majority of the members of the board
of directors of the Surviving Entity were Incumbent Directors at the time
of the Board’s approval of the execution of the initial agreement
providing for such Reorganization, Sale or Acquisition (any
Reorganization, Sale or Acquisition which satisfies all of the criteria
specified in (A), (B) and (C) above shall be deemed to be a “Non-Qualifying
Transaction”); or
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(e) approval
by the shareholders of the Company of a complete liquidation or
dissolution of the Company.
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2. Position
and Duties.
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(a) During
the Employment Period, the Executive shall serve as Chairman of the Board
of Directors and Chief Executive Officer of the Company, in each case with
such duties and responsibilities as are customarily assigned to such
positions, and such other duties and responsibilities not inconsistent
therewith as may from time to time be assigned to him by the Board of
Directors of the Company (the “Board”).
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(b) During
the Employment Period, and excluding any periods of vacation and sick
leave to which the Executive is entitled, the Executive shall devote
substantially all of his business time, attention and effort to the
business and affairs of the Company and its affiliates and, to the extent
necessary to discharge the responsibilities assigned to the Executive
under this Agreement, use the Executive’s reasonable best efforts to
carry out such responsibilities faithfully and efficiently. It shall not
be considered a violation of the foregoing for the Executive to serve on
corporate, industry, civic or charitable boards or committees, so long as
such activities do not significantly interfere with the performance of the
Executive’s responsibilities as an employee of the Company and its
affiliates in accordance with this Agreement.
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3.
Compensation.
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(a) Base
Salary. The Executive’s compensation during the Employment Period
shall be determined by the Board upon the recommendation of the
Compensation Committee (or other appropriate committee) of the Board,
subject to this Section 3. During the Employment Period, the Executive
shall receive an annual base salary (“Annual Base Salary”) of
not less than his aggregate annual base salary from the Company and its
affiliates as in effect immediately before the date of this Agreement. The
Annual Base Salary shall be payable in accordance with the Company’s
regular payroll practice for its senior executives, as in effect from time
to time. During the Employment Period, the Annual Base Salary shall be
reviewed for possible increase at least annually. Any increase in the
Annual Base Salary shall not limit or reduce any other obligation of the
Company under this Agreement. The Annual Base Salary shall not be reduced
after any such increase, and the term “Annual Base Salary” shall
thereafter refer to the Annual Base Salary as so increased.
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(b) Incentive
Compensation. During the Employment Period, the Executive shall
continue to participate in short-term incentive compensation plans and
long-term incentive compensation plans (the latter to consist of plans
offering stock options, restricted stock and other long-term incentive
compensation) offered by the Company and its present or future affiliates
which shall provide him with the opportunity to earn, on a year-by-year
basis, short-term and long-term incentive compensation (the “Incentive
Compensation”). The annual and long-term incentive target
opportunities for the Executive will be equal to or higher than the
targets set for other senior executives of the Company. Without limiting
the foregoing, for a period of two years after the occurrence of a Change
in Control, the Executive’s target annual bonus opportunity shall be
no less than his target annual bonus opportunity for the last full fiscal
year prior to the effective date of the Change in Control.
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(c) Other
Benefits. In addition, and without limiting the generality of the
foregoing, during the Employment Period and thereafter as applicable: (i)
the Executive shall be entitled to participate in all applicable
incentive, savings and retirement plans, practices, policies and programs
of the Company and its affiliates to the same extent as other senior
executives of the Company, and (ii) the Executive and/or the Executive’s
family, as the case may be, shall be eligible for all applicable welfare
benefit plans, practices, policies and programs provided by the Company
and its affiliates, other than severance plans, practices, policies and
programs but including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life insurance, group life
insurance, accidental death and travel accident insurance plans and
programs, to the same extent as other senior executives of the Company.
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(d) Perquisites.
During the Employment Period, the Executive shall be entitled to receive
such perquisites as the Company may establish from time to time which are
commensurate with his position and at least comparable to those received
by other senior executives at the Company.
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(e) Expense
Reimbursement. The Company shall reimburse the Executive for all
reasonable and documented expenses incurred by the Executive in the
performance of the Executive’s duties under this Agreement and for a
period of one (1) year following any termination, reasonable office and
administrative support.
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4.
Termination of Employment.
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(a) Death
or Disability. The Executive’s employment shall terminate
automatically upon the Executive’s death during the Employment
Period. The Company shall be entitled to terminate the Executive’s
employment because of the Executive’s Disability during the
Employment Period. “Disability” means that (i) the Executive has
been unable, for a period of 180 consecutive business days, to perform the
Executive’s duties under this Agreement, as a result of physical or
mental illness or injury, and (ii) a physician selected or approved by the
Company has determined that it is either not possible to determine when
such inability to perform will cease or that it appears probable that such
inability will be permanent during the remainder of the Executive’s
life. A termination of the Executive’s employment by the Company for
Disability shall be communicated to the Executive by written notice, and
shall be effective on the 30th day after receipt of such notice by the
Executive (the “Disability Effective Date”), unless the
Executive returns to full-time performance of the Executive’s duties
before the Disability Effective Date.
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(i)
The Company may terminate the Executive’s employment during the
Employment Period for Cause or without Cause. “Cause” means:
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A.
the willful and continued failure of the Executive substantially to perform
the Executive’s duties under this Agreement (other than as a result of
physical or mental illness or injury), after the Board delivers to the
Executive a written demand for substantial performance that specifically
identifies the manner in which the Board believes that the Executive has not
substantially performed the Executive’s duties; or
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B.
illegal conduct or gross misconduct by the Executive, in either case that is
willful and results in material and demonstrable damage to the business or
reputation of the Company.
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No
act or failure to act on the part of the Executive shall be considered “willful”unless
it is done, or omitted to be done, by the Executive in bad faith or without reasonable
belief that the Executive’s action or omission was in the best interests of the
Company. Any act or failure to act that is based upon authority given pursuant to a
resolution duly adopted by the Board, or the advice of counsel for the Company, shall be
conclusively presumed to be done, or omitted to be done, by the Executive in good faith
and in the best interests of the Company. |
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(ii)
A termination of the Executive’s employment for Cause shall be effected
in accordance with the following procedures. The Company shall give the
Executive written notice (“Notice of Termination for Cause”) of its
intention to terminate the Executive’s employment for Cause, setting forth
in reasonable detail the specific conduct of the Executive that it considers to
constitute Cause and the specific provision(s) of this Agreement on which it
relies, and stating the date, time and place of the Special Board Meeting for
Cause. The “Special Board Meeting for Cause” means a meeting of the
Board called and held specifically for the purpose of considering the Executive’s
termination for Cause, that takes place not less than ten (10) and not more
than twenty (20) business days after the Executive receives the Notice of
Termination for Cause. The Executive shall be given an opportunity, together
with counsel, to be heard at the Special Board Meeting for Cause. The Executive’s
termination for Cause shall be effective when and if a resolution is duly
adopted at the Special Board Meeting for Cause by a majority vote of the entire
membership of the Board, excluding employee directors, stating that in the good
faith opinion of the Board, the Executive is guilty of the conduct described in
the Notice of Termination for Cause, and that conduct constitutes Cause under
this Agreement.
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(iii)
A termination of the Executive’s employment without Cause shall be
effected in accordance with the following procedures. The Company shall give
the Executive written notice (“Notice of Termination without Cause”)
of its intention to terminate the Executive’s employment without Cause,
stating the date, time and place of the Special Board Meeting without Cause.
The “Special Board Meeting without Cause” means a meeting of the
Board called and held specifically for the purpose of considering the Executive’s
termination without Cause, that takes place not less than ten (10) and not more
than twenty (20) business days after the Executive receives the Notice of
Termination without Cause. The Executive shall be given an opportunity,
together with counsel, to be heard at the Special Board Meeting without Cause.
The Executive’s termination without Cause shall be effective when and if a
resolution is duly adopted at the Special Board Meeting without Cause by a
majority vote of the entire membership of the Board, excluding employee
directors, stating that the Executive is terminated without Cause.
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(i)
The Executive may terminate employment for Good Reason or without Good
Reason. “Good Reason” means:
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A.
the assignment to the Executive of any duties inconsistent in any respect
with paragraph (a) of Section 2 of this Agreement, or any other action by the
Company that results in a diminution in the Executive’s position,
authority, duties or responsibilities, other than an isolated, insubstantial
and inadvertent action that is not taken in bad faith and is remedied by the
Company promptly after receipt of notice thereof from the Executive;
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B. |
any
failure by the Company to comply with any provision of Section 3 of this
Agreement, other than an isolated, insubstantial and inadvertent failure that
is not taken in bad faith and is remedied by the Company promptly after receipt
of notice thereof from the Executive; |
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C.
any failure by the Company to comply with paragraph (c) of Section 9 of this
Agreement; or
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E.
any other substantial breach of this Agreement by the Company that either is
not taken in good faith or is not remedied by the Company promptly after
receipt of notice thereof from the Executive.
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Without
limiting the foregoing, in the event a Change in Control shall occur during the
Employment Term, any termination of employment by the Executive during the 30-day period
immediately following the 6-month anniversary of the Change in Control shall be deemed to
be a termination for Good Reason for all purposes of this Agreement. The foregoing
sentence shall not apply if the Change in Control is a management-led buy-out or similar
going-private transaction in which the Executive, or a group of which he is a member,
participates as an acquiror.
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(ii)
A termination of employment by the Executive for Good Reason shall be
effectuated by giving the Company written notice (“Notice of Termination
for Good Reason”) of the termination within six months of the event
constituting Good Reason, setting forth in reasonable detail the specific
conduct of the Company that constitutes Good Reason and the specific
provision(s) of this Agreement on which the Executive relies. A termination of
employment by the Executive for Good Reason shall be effective on the fifth
business day following the date when the Notice of Termination for Good Reason
is given, unless the notice sets forth a later date (which date shall in no
event be later than thirty (30) days after the notice is given).
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(iii)
A termination of the Executive’s employment by the Executive without
Good Reason shall be effected by giving the Company written notice of the
termination.
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(d) Date
of Termination. The “Date of Termination” means the last day
of the Employment Period, the date of the Executive’s death, the
Disability Effective Date, the date on which the termination of the
Executive’s employment by the Company for Cause or without Cause or
by the Executive for Good Reason is effective, or the later of the date on
which the Executive gives the Company notice of a termination of
employment without Good Reason, as the case may be, or such later date as
is acceptable to the Board.
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5.
Obligations of the Company upon Termination.
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(a) By
the Company other than for Cause or Disability; by the Executive for Good
Reason. If, during the Employment Period, (x) the Company terminates
the Executive’s employment, other than for Cause or Disability, or
(y) the Executive terminates employment for Good Reason,
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(i)
the Company shall pay to the Executive in a lump sum in cash, within 30 days
after the Date of Termination, his Annual Base Salary through the Date of
Termination to the extent not theretofore paid; and
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(ii)
the Company shall pay to the Executive in a lump sum in cash upon the earlier
of (a) a date no later than 30 days after the Executive’s death, or (b)
the first day of the seventh month following Executive’s “separation
from service” as defined in Section 409A of the Internal Revenue Code
of 1986 (the “Code”) and applicable regulations, without giving
effect to any elective provisions that may be available under such definition
(“Separation from Service”) the aggregate of the following amounts:
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A.
the product of (x) the Executive’s target annual incentive bonus for the
year in which the Date of Termination occurs (“Target Annual Bonus”)
and (y) a fraction, the numerator of which is the number of days in the current
fiscal year through the Date of Termination, and the denominator of which is
365 (the “Prorata Current Year Bonus”); and
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B.
a severance payment equal to 300% times the sum of (i) the Executive’s
Annual Base Salary and (ii) Target Annual Bonus; and
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(iii)
the Company shall continue to provide, for thirty-six (36) months after the
Date of Termination (the “Welfare Benefits Continuation Period”), the
benefits set forth in paragraph (c) of Section 3 as if he had remained employed
by the Company pursuant to this Agreement throughout the Welfare Benefits
Continuation Period. To the extent any benefits described in paragraph (c) of
Section 3 cannot be provided pursuant to the plan or program maintained by the
Company for its executives, the Company shall provide such benefits outside
such plan or program at no additional cost (including without limitation tax
cost) to the Executive and his family. During any period when the Executive is
eligible to receive health and similar benefits under another employer-provided
plan, the benefits provided by the Company under this Section 5(a)(iii) may be
made secondary to those provided under such other plan. During the Welfare
Benefits Continuation Period, (A) the benefits provided in any one calendar
year shall not affect the amount of benefits to be provided in any other
calendar year; (B) for all months after the initial 18 months of the Welfare
Benefits Continuation Period, the applicable monthly COBRA premium for such
group health benefits, determined in accordance with Code Section 4980B and the
regulations thereunder, shall be reimbursed to the Executive by the Company as
taxable compensation by including such amount in the Executive’s income in
accordance with applicable rules and regulations (such income shall be grossed
up as for taxes, as provided above); (C) the reimbursement of an eligible
taxable expense shall be made on or before December 31 of the year following
the year in which the expense was incurred; and (D) the Executive’s rights
pursuant to this Section 5(a)(iii) shall not be subject to liquidation or
exchange for another benefit; and
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(iv)
all of the Executive’s equity or incentive awards outstanding on the
Date of Termination shall be treated as follows: (x) all time-based
restrictions on awards of restricted stock or unit awards shall lapse as of the
Date of Termination, (y) each such option or stock appreciation right shall be
fully vested and exercisable as of the Date of Termination and shall remain in
effect and exercisable through the end of its original term, without regard to
the termination of the Executive’s employment; and (z) any performance
shares or units shall be governed by the terms and conditions of the Company’s
long-term incentive plan under which they were awarded.
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The
payments and benefits provided pursuant to this paragraph (a) of Section 5 are intended
as liquidated damages for a termination of the Executive’s employment by the Company
other than for Cause or Disability or for the actions of the Company leading to a
termination of the Executive’s employment by the Executive for Good Reason, and
shall be the sole and exclusive remedy therefor.
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(b) Death.
If the Executive’s employment is terminated by reason of the Executive’s
death during the Employment Period, the Company shall pay to the Executive’s
designated beneficiaries (or, if there is no such beneficiary, to the
Executive’s estate or legal representative), any portion of the
Executive’s Annual Base Salary through the Date of Termination that
has not yet been paid and the Prorata Current Year Bonus.
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(c) Disability.
If the Executive’s employment is terminated by reason of the Executive’s
Disability during the Employment Period, the Executive shall be entitled
to any potion of the Executive’s Annual Base Salary through the Date
of Termination that has not yet been paid, to the Prorata Current Year
Bonus, and to such other, nonduplicative benefits as may be provided by
the Company’s current disability program. The Prorata Current Year
Bonus shall be paid to the Executive or the Executive’s estate or
beneficiary, as applicable, in a lump sum in cash upon the earlier of (i)
a date no later than 30 days after the Executive’s death, or (ii) the
first day of the seventh month following the Executive’s Separation
from Service.
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(d) By
the Company for Cause; By the Executive Other than for Good Reason; End of
the Employment Period. If the Executive’s employment is
terminated at the end of the Employment Period or by the Company for Cause
during the Employment Period or if the Executive voluntarily terminates
employment during the Employment Period other than for Good Reason, the
Company shall pay to the Executive any portion of the Executive’s
Annual Base Salary through the Date of Termination that has not yet been
paid and the Company shall have no further obligations under this
Agreement, except as specified in Section 6 below.
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6.
Non-exclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Executive’s continuing or future participation in any plan,
program, policy or practice provided by the Company or any of its affiliates
for which the Executive may qualify, nor shall anything in this Agreement limit
or otherwise affect such rights as the Executive may have under any contract or
agreement with the Company or any of its affiliates relating to subject matter
other than that specifically addressed herein. Vested benefits and other
amounts that the Executive is otherwise entitled to receive under the Incentive
Compensation program, the Executive’s deferred compensation plan(s), or
any other plan, policy, practice or program of, or any contract or agreement
with, the Company or any of its affiliates on or after the Date of Termination
shall be payable in accordance with the terms of each such plan, policy,
practice, program, contract or agreement, as the case may be, except as
explicitly modified by this Agreement.
7.
Full Settlement. The Company’s obligation to make the payments
provided for in, and otherwise to perform its obligations under, this Agreement
shall not be affected by any set-off, counterclaim, recoupment, defense or
other claim, right or action that the Company may have against the Executive or
others. In no event shall the Executive be obligated to seek other employment
or take any other action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement.
8.
Non-Compete and Other Restrictions.
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(a) For
purposes of this Section 8, the following definitions apply:
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(i)
“Company” means the Company and/or any one or more of its
affiliates that were within the Executive’s management
responsibility, including the responsibility of personnel reporting to the
Executive, at any time within two (2) years prior to the Executive’s
termination.
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(ii)
“Confidential Information” means information of the Company that
meets one or more of the following three conditions: (i) it has not been
made available generally to the public or to the trade or industry by the
Company or by another with the Company’s consent; (ii) it is related
to, and useful or valuable in, the current or anticipated business of the
Company and its value could be diminished by unauthorized disclosure or
use; or (iii) it either has been identified as confidential to the
Executive by the Company (orally or in writing) or it has been maintained
as confidential from outside parties or is recognized as intended for
internal disclosure only. Confidential Information includes but is not
limited to strategic and other business plans and budgets, non-public
financial data and forecasts, know-how, research and development programs,
personnel information (including information about the identity,
responsibilities, competence, compensation and satisfaction of the
Company’s employees), information about planned or pending
acquisitions or divestitures, sales methods, customer lists, customer
usages and requirements, customer purchase histories, marketing programs,
computer programs and other confidential technical or business information
or data.
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(iii)
“Trade Secret” means information of the Company, including a
formula, pattern, compilation, program, device, method, technique or
process, that derives independent economic value, actual or potential,
from not being generally known to, and not being readily ascertainable by
proper means by, other persons who can obtain economic value from its
disclosure or use, and that is the subject of efforts to maintain its
secrecy that are reasonable under the circumstances.
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(b) During
employment with the Company, the Executive shall preserve and protect
Confidential Information from unauthorized use or disclosure, and for a
period of two (2) years after termination of such employment, the
Executive shall not use or disclose any Confidential Information in
connection with or to benefit any person, company or other enterprise
(including the Executive) which is engaged in or is planning to become
engaged in direct competition with the Company in any state of the United
States of America where, at the time this Agreement is to be enforced, the
Company is engaged, or has demonstrable plans to engage that were known to
the Executive during employment, in substantial business activities.
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(c) During
employment with the Company, the Executive shall preserve and protect
Trade Secrets from unauthorized use or disclosure, and after termination
of such employment, the Executive shall not use or disclose any Trade
Secret indefinitely, or for so long as that Trade Secret remains a Trade
Secret under applicable law.
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(d) The
Executive agrees that, at all times during the term of employment hereunder,
and for a period ending two (2) years following the Date of Termination
for any reason, the Executive will not directly or indirectly, participate
in or assist in, the organization, planning, preparation, ownership,
financing, management, operation or control, nor have any beneficial
interest in more than 5% of the equity, of any corporation, partnership,
association or other person or entity which directly competes or is
planning to directly compete with the Company with respect to the
operations of the Company that were within the Executive’s management
responsibility, including the responsibility of personnel reporting to the
Executive, at any time within two (2) years prior to the Executive’s
termination (“Competitive Business”), if:
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(i)
said Competitive Business would utilize the Executive’s services for
the benefit of any broadcast, cable, print or other mass communications
media operations serving any Metropolitan Statistical Area, as that term
is defined by the United States Government, where during two (2) years
preceding the Executive’s termination and at the time this Agreement
is to be enforced, the Company is engaged, or has demonstrable plans to
engage that were known to the Executive during employment, in broadcast,
cable, print or other mass communications media operations; and
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(ii)
Confidential Information acquired by the Executive during the two (2)
years preceding Executive’s termination would reasonably be expected
to be useful to the performance of the Executive’s duties in such
employment.
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(e) The
Executive acknowledges that a duty of loyalty to the Company and a duty to
protect the Company’s confidential information are imposed upon
Executive by law, including section 134.90 of the Wisconsin Statutes.
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(f) For
a period of two (2) years following the Date of Termination, the Executive
agrees not to solicit or induce, or to assist anyone else in soliciting or
inducing, directly or indirectly, any employee of the Company who was
supervised by the Executive, or about whom the Executive obtained any
Confidential Information, during the last two (2) years of the Executive’s
employment by the Company, to terminate their employment with the Company
or to accept employment with a Competing Business. This provision is not
intended to restrict the employment opportunities of any employees of the
Company who seek employment with a Competitive Business without any
solicitation or inducement by the Executive.
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(g) The
Executive acknowledges that the Company has disclosed that the Company is
now, and may be in the future, subject to duties to third parties to
maintain information in confidence and secrecy. By executing this
Agreement, the Executive consents to be bound by any such duty owed by the
Company to any third party.
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(h) At
the Date of Termination, or at any time upon the Company’s request, the
Executive shall deliver to the Company the original and all copies of all
documents, records and property of any nature whatsoever which are in the
Executive’s possession or control and which are the property of the
Company or which relate to the business activities, facilities or
customers of the Company, including any records, documents or property
created by the Executive in said capacity, The Executive agrees to attend
an exit interview upon termination of employment to ensure compliance with
the terms of this Agreement.
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(i) For
the period of two (2) years immediately following the Date of Termination,
the Executive will inform each new employer, prior to accepting
employment, of the existence of this Section 8 and provide that employer
with a copy of it. In addition, the Executive hereby authorizes the
Company to forward a copy of this Section 8 to any actual or prospective
new employer.
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9.
Successors.
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(a) This
Agreement is personal to the Executive and, without the prior written
consent of the Company, shall not be assignable by the Executive. This
Agreement shall inure to the benefit of and be enforceable by the Executive’s
legal representatives.
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(b) This
Agreement shall inure to the benefit of and be binding upon the Company and
its successors and assigns.
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(c) The
Company shall require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all
of the business and/or assets of the Company expressly to assume and agree
to perform this Agreement in the same manner and to the same extent that
the Company would have been required to perform it if no such succession
had taken place. As used in this Agreement, “Company” shall mean
both the Company as defined above and any such successor that assumes and
agrees to perform this Agreement, by operation of law or otherwise.
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10. Miscellaneous.
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(a) This
Agreement shall be governed by, and construed in accordance with, the laws
of the State of Wisconsin, without reference to principles of conflict of
laws. The captions of this Agreement are not part of the provisions hereof
and shall have no force or effect. This Agreement may not be amended or
modified except by a written agreement executed by the parties hereto or
their respective successors and legal representatives.
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(b) All
notices and other communications under this Agreement shall be in writing
and shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as
follows:
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Xxxxxx
X. Xxxxx
Journal Communications, Inc.
000 Xxxx Xxxxx
Xxxxxx
Xxxxxxxxx, XX 00000 |
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Journal
Communications, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx,
XX 00000
Attention: Chief Financial Officer |
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Xxxxxxxx
X. Xxxxxx, III
c/o Foley & Xxxxxxx LLP
000 Xxxx
Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000 |
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or
to such other address as either party furnishes to the other in writing in accordance
with this paragraph (b) of Section 10. Notices and communications shall be effective when
actually received by the addressee. |
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(c) The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this
Agreement. If any provision of this Agreement shall be held invalid or
unenforceable in part, the remaining portion of such provision, together
with all other provisions of this Agreement, shall remain valid and
enforceable and continue in full force and effect to the fullest extent
consistent with law.
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(d) Notwithstanding
any other provisions of this Agreement, the Company may withhold from
amounts payable under this Agreement all federal, state, local and foreign
taxes that are required to be withheld by applicable laws or regulations.
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(e) The
Executive’s or the Company’s failure to insist upon strict
compliance with any provisions of, or to assert any right under, this
Agreement (including, without limitation, the right of Executive to
terminate employment for Good Reason pursuant to paragraph (c) of Section
4 of this Agreement) shall not be deemed to be a waiver of such provision
or right or of any other provision of or right under this Agreement.
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(f) The
rights and benefits of the Executive under this Agreement may not be
anticipated, assigned, alienated or subject to attachment, garnishment,
levy, execution or other legal or equitable process except as required by
law. Any attempt by the Executive to anticipate, alienate, assign, sell,
transfer, pledge, encumber or charge the same shall be void.
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(g) This
Agreement may be executed in several counterparts, each of which shall be
deemed an original, and said counterparts shall constitute but one and the
same instrument.
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11.
Arbitration.
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(a) The
Company and the Executive agree that any dispute in connection with this
Agreement shall be settled by binding arbitration conducted pursuant to
the National Rules for the Resolution of Employment Disputes of the
American Arbitration Association (the “AAA”). Notwithstanding
the foregoing, (i) the assessment of legal fees and related costs of such
arbitration incurred by the Executive shall be governed by the provisions
of Section 15 of this Agreement; (ii) the arbitration shall be determined
by a single arbitrator, not a panel; (iii) both the Company and the
Executive shall be permitted to seek summary disposition prior to hearing;
and (iv) the decision rendered by the arbitrator shall be in writing and
set forth findings of fact and conclusions of law.
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(b) The
Executive agrees that his agreement to submit legal disputes through binding
arbitration, includes any claim for any liability or obligation in any way
related to this Agreement, for any expense, damage, or losses he might
claim based on, among other things, the following: (i) any discipline,
demotion, denied promotion, or discharge; (ii) any Company policy,
practice, contract or agreement; (iii) any tort or personal injury; (iv)
any policies, practices, laws or agreements governing the payment of
wages, commissions or other compensation; (v) any laws governing
employment discrimination including, but not limited to, Sections 1981,
1983 and Title VII of the Civil Rights Act, the Age Discrimination in
Employment Act, the Employee Retirement Income Security Act, the Americans
with Disabilities Act, any state laws or statutes (including, but not
limited to, the Wisconsin Fair Employment Act), and any ordinance or local
authority; (vi) any laws or agreements that provide for punitive,
exemplary or statutory damages; and (vii) any laws or agreements that
provide for payment of attorney fees, costs or expenses.
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(c) The
Company agrees that it too shall submit all legal disputes that it may have
against the Executive in any way related to this Agreement for exclusive
resolution through binding arbitration, and that the resolution of the
Executive’s legal dispute(s) through arbitration shall be binding
upon it.
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(d) The
Company and the Executive acknowledge and agree that this Agreement does not
apply to the following: (i) claims under any state worker’s
compensation law; (ii) claims under any state unemployment compensation
law; (iii) claims for injunctive relief that may otherwise be available at
law for the violation of any state trade secrets act or unfair competition
law; or (iv) any claim that by law may not be required to be resolved by
binding arbitration.
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(e) The
Company and the Executive acknowledge and agree that damages awarded, if
any, in any arbitration shall be limited to those damages that are
otherwise available at law.
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(f) The
Company and Executive acknowledge and agree that by signing this Agreement,
they release and waive any right either may have to resolve their legal
disputes (including employment disputes and claims of discrimination or
unlawful discharge) by filing a lawsuit in court, and to have the
potential opportunity of having their claim heard by a jury, and agree
instead that the disputes will be resolved exclusively through binding
arbitration. The Company and the Executive acknowledge that although the
Executive agrees to resolve the Executive’s legal dispute(s)
exclusively through binding arbitration, nothing in this Agreement shall
be interpreted as prohibiting the Executive from filing a charge of
discrimination with an appropriate administrative agency or participating
in the investigation or prosecution of such a charge by an appropriate
administrative agency; however, this Agreement does prohibit the Executive
from seeking and recovering an award on his own behalf through any
administrative process.
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12.
Effectiveness of Agreement. This Agreement is effective when executed by
the Company and the Executive in the signature spaces provided below.
13.
Limitation of Benefits.
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(a) Notwithstanding
anything in this Agreement to the contrary, in the event it shall be
determined that any benefit, payment or distribution by the Company to or
for the benefit of the Executive (whether payable or distributable pursuant
to the terms of this Agreement or otherwise) (such benefits, payments or
distributions are hereinafter referred to as “Payments”) would,
if paid, be subject to the excise tax (the “Excise Tax”) imposed
by Section 4999 of the Code, then the aggregate present value of the
Payments shall be reduced (but not below zero) to an amount expressed in
present value that maximizes the aggregate present value of the Payments
without causing the Payments or any part thereof to be subject to the
Excise Tax and therefore nondeductible by the Company because of Section
280G of the Code (the “Reduced Amount”). For purposes of this
Section 13, present value shall be determined in accordance with Section
280G(d)(4) of the Code. In the event it is necessary to reduce the
Payments, the Executive shall direct which Payments are to be modified or
reduced.
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(b) All
determinations required to be made under this Section 13, including whether
an Excise Tax would otherwise be imposed, whether the Payments shall be
reduced, the amount of the Reduced Amount, and the assumptions to be
utilized in arriving at such determinations, shall be made by an
independent, nationally recognized accounting firm or compensation
consulting firm mutually acceptable to the Company and the Executive (the
“Determination Firm”) which shall provide detailed supporting
calculations both to the Company and the Executive within 15 business days
of the receipt of notice from the Executive that a Payment is due to be
made, or such earlier time as is requested by the Company. All fees and
expenses of the Determination Firm shall be borne solely by the Company.
Any determination by the Determination Firm shall be binding upon the
Company and the Executive. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial
determination by the Determination Firm hereunder, it is possible that
Payments hereunder will have been unnecessarily limited by this Section 13
(“Underpayment”), consistent with the calculations required to
be made hereunder. The Determination Firm shall determine the amount of
the Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Company to or for the benefit of the Executive
together with interest at the applicable Federal rate provided for in
Section 7872(f)(2) of the Code, but no later than December 31 of the year
after the year in which the Underpayment is determined to exist.
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(c) In
the event that the provisions of Code Section 280G and 4999 or any successor
provisions are repealed without succession, this Section 13 shall be of no
further force or effect.”
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14.
Code Section 409A.
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(a) Notwithstanding
anything in this Agreement to the contrary, to the extent that any amount
or benefit that would constitute non-exempt “deferred compensation” for
purposes of Section 409A of the Code would otherwise be payable or
distributable hereunder by reason of the Executive’s termination of
employment, such amount or benefit will not be payable or distributable to
the Executive by reason of such circumstance unless (i) the
circumstances giving rise to such termination of employment meet any
description or definition of “separation from service” in Section 409A
of the Code and applicable regulations (without giving effect to any
elective provisions that may be available under such definition), or (ii) the
payment or distribution of such amount or benefit would be exempt from the
application of Section 409A of the Code by reason of the short-term
deferral exemption or otherwise. This provision does not prohibit the vesting of
any amount upon a termination of employment, however defined. If this
provision prevents the payment or distribution of any amount or benefit,
such payment or distribution shall be made on the date, if any, on which
an event occurs that constitutes a Section 409A-compliant “separation
from service” or such later date as may be required by Subsection
14(b) below.
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(b) Notwithstanding
anything in this Agreement to the contrary, if any amount or benefit that
would constitute non-exempt “deferred compensation” for purposes
of Section 409A of the Code would otherwise be payable or distributable
under this Agreement by reason of the Executive’s Separation from
Service during a period in which he is a Specified Employee (as defined
below), then, subject to any permissible acceleration of payment by the
Company under Treas. Reg. Section 1.409A-3(j)(4)(ii) (domestic relations
order), (j)(4)(iii) (conflicts of interest), or (j)(4)(vi) (payment of
employment taxes):
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(i)
if the payment or distribution is payable in a lump sum, the Executive’s
right to receive payment or distribution of such non-exempt deferred
compensation will be delayed until the earlier of the Executive’s death or
the first day of the seventh month following the Executive’s Separation
from Service; and
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(ii)
if the payment or distribution is payable over time, the amount of such
non-exempt deferred compensation that would otherwise be payable during the
six-month period immediately following the Executive’s Separation from
Service will be accumulated and the Executive’s right to receive payment
or distribution of such accumulated amount will be delayed until the earlier of
the Executive’s death or the first day of the seventh month following the
Executive’s Separation from Service, whereupon the accumulated amount will
be paid or distributed to the Executive and the normal payment or distribution
schedule for any remaining payments or distributions will resume.
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For
purposes of this Agreement, the term “Specified Employee” has the meaning given
such term in Code Section 409A and the final regulations thereunder (“Final 409A
Regulations”), provided, however, that, as permitted in the Final 409A
Regulations, the Company’s Specified Employees and its application of the six-month
delay rule of Code Section 409A(a)(2)(B)(i) shall be determined in accordance with rules
adopted by the Board of Directors or a committee thereof, which shall be applied
consistently with respect to all nonqualified deferred compensation arrangements of the
Company, including this Agreement.
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15.
Costs of Enforcement. The Company shall reimburse the Executive, on a
current basis, up to $200,000 per year (not to exceed two years) for reasonable
legal fees and related expenses incurred by the Executive in connection with
this Agreement, including without limitation, (i) such fees and expenses, if
any, incurred by the Executive in connection with any tax audit or proceeding
to the extent attributable to the application of Section 4999 of the Code to
any payment or benefit hereunder, or (ii) such fees and expenses, if any,
incurred by the Executive in contesting or disputing any termination of
Executive’s employment, or the Executive’s seeking to obtain or
enforce any right or benefit provided by this Agreement, in each case,
regardless of whether or not the Executive’s claim is upheld by an
arbitral panel or a court of competent jurisdiction; provided, however, the
Executive shall be required to repay to the Company any such amounts to the
extent that an arbitral panel or a court issues a final and non-appealable
order, judgment, decree or award setting forth the determination that the
position taken by the Executive was frivolous or advanced by the Executive in
bad faith. The amount reimbursable by the Company under this Section 15 in any
one calendar year shall not affect the amount reimbursable in any other
calendar year, and the reimbursement of an eligible expense shall be within
five business days after delivery of the Executive’s respective written
requests for payment accompanied with such evidence of fees and expenses
incurred as the Company reasonably may require, but in any event no later than
December 31 of the year after the year in which the expense was incurred. The
Executive’s rights pursuant to this Section 15 shall expire at the end of
five years after the date of termination and shall not be subject to
liquidation or exchange for another benefit.
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IN
WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and,
pursuant to the authorization of its Board of Directors, the Company has caused this
Agreement, as amended and restated, to be executed in its name and on its behalf.
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JOURNAL COMMUNICATIONS, INC. |
|
By: /s/ Xxxxx X. Xxxxxx |
|
Xxxxx X. Xxxxxx |
|
Chair, Compensation Committee |
|
EXECUTIVE |
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/s/ Xxxxxx X. Xxxxx |
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Xxxxxx X. Xxxxx |
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