EXHIBIT 99.7
EMPLOYMENT AGREEMENT
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This Employment Agreement (this "Agreement") is entered into as of
_________, 1996, between United Video Satellite Group, Inc., a Delaware
corporation (the "Company"), and Xxxxxxxx Xxxxx, Xx. ("Employee").
Recitals
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WHEREAS, Tele-Communications, Inc. ("TCI") has taken actions to
acquire a voting interest in the Company of not less than 80% through a merger
of a direct wholly owned subsidiary of TCI, with and into the Company (the
"Merger"); and
WHEREAS, the Company and Employee desire to enter into this Agreement.
NOW THEREFORE, for and in consideration of the mutual covenants and
conditions contained herein and other good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, Company and Employee
hereby agree as follows:
1. Employment. The Company agrees to employ Employee and Employee
agrees to be employed by the Company on the terms set forth in this agreement.
2. Title and Duties; Scope of Responsibilities.
(a) Title and Duties. Employee shall be employed by the Company
and shall serve as Chairman of the Board and Chief Executive Officer of the
Company. Employee shall (i) provide strategic oversight planning and management;
and (ii) act as Chief Executive Officer of the Company and supervise and direct
management employees.
(b) Scope of Responsibilities. Employee shall devote as much
time as is reasonably required to perform his duties under this Agreement. His
actions shall at all times be such that they do not discredit the Company or its
products and services.
3. Compensation.
(a) Salary. For all services rendered by Employee hereunder,
the Company shall pay Employee during the term of this Agreement a base salary,
payable semimonthly in arrears. Employee's base salary of $575,000 per annum in
effect at December 31, 1995 was increased by 12.5% effective January 1, 1996,
and will be subject to
annual increases of 8% on January 1 in each of the two years after 1996, unless
this Agreement is sooner terminated in accordance with Section 5.
(b) Benefits. In addition to salary payments as provided in
Section 3(a), the Company shall provide Employee, during the term of this
Agreement, with the benefits of such insurance plans, hospitalization plans,
pension or profit sharing plans and other employee fringe benefit plans as shall
be generally provided to employees of the Company and for which Employee may be
eligible under the terms of such plans. Nothing in this Agreement shall require
the Company to adopt or maintain any such employee benefit plans. Employee shall
be entitled to sick leave and vacation in accordance with the Company's
established policies applicable to its employees generally. Benefits to be
provided by the Company under Sections 5(d) and 5(e) after termination of this
Agreement for the periods specified therein shall include health insurance and
long term disability insurance to the extent the company may provide the same to
former employees. Such benefits shall not include participation in the Company's
401(k) plan or any similar benefit plans of the Company. Notwithstanding the
foregoing Employee shall have the benefits, prerequisites, staff and office
facilities in Fairfield County, CT that he has on the date of this Agreement.
(c) Stock Options; Bonuses. Employee may also be granted
options and other equity incentives by the Company from time to time. Nothing in
this Agreement shall require the Company to establish an equity incentive
program or confer on Employee any right to receive any stock option or other
equity incentive. If Employee's employment is terminated by the Company without
cause, all stock options granted by the Company to Employee shall immediately
vest and become fully exercisable. Employee may also be granted bonuses by the
Company from time to time; provided, however, that nothing contained herein
shall obligate the Company to pay any bonuses to Employee or to maintain any
bonus procedures, such matters being left to the sole discretion of the
Compensation Committee of the Board following consultation with independent
compensation consultants.
4. Term. Unless sooner terminated in accordance with Section 5,
this Agreement shall terminate on the third anniversary date of the Closing (as
defined in the Agreement and Plan of Merger dated as of July 10, 1995 ("Merger
Agreement")) of the Merger. Termination of this Agreement under this Section 4,
shall not of itself constitute termination of Employee's employment by the
Company. Sections 6, 7, 8 and 9 shall remain in full force and effect for the
periods specified in such sections notwithstanding any termination of this
Agreement.
5. Early Termination.
(a) Death. If Employee dies during the term of this Agreement,
the Company shall make a lump sum payment (less applicable withholding taxes) to
his estate in an amount equal to the salary (but not bonus) that would have been
payable for the 12 months next following his death.
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(b) Disability. If during the term of this Agreement Employee
becomes disabled, the Company may terminate this Agreement on 30 days' prior
notice to Employee or his duly appointed legal representative. For purposes of
this Section 5(b), the Employee becomes "disabled" if he is unable to engage in
any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or which
has lasted or can be expected to last for a continuous period of not less than
12 months. If this Agreement is terminated under this Section 5(b), Employee
shall continue to receive his base salary through the date that is 12 months
after such termination.
(c) Cause. The Company may terminate this Agreement at any time
for "cause." For purposes of this Agreement, cause shall be defined as either of
the following: (i) gross negligence by the Employee in the performance of his
duties under this Agreement as determined by the Company; or (ii) the Employee's
engaging in activities that materially adversely affect the Company or that
involve illegal or materially unethical behavior counter to the best interests
of the Company (for example, conveying trade secrets to a competitor). If this
Agreement is terminated for cause, Employee's rights hereunder shall cease
immediately upon such termination.
(d) Change of Control. If Employee's employment is terminated
by the Company or if Employee resigns after being assigned to a position of
lesser responsibility, in either case within a six-month period after the
occurrence of a Change of Control, this Agreement shall immediately terminate
and Employee shall be entitled to receive (i) a severance payment equal to the
amount of his base salary for the remainder of a two-year period following the
occurrence of a Change of Control; and (ii) a continuation of benefits as
specified in Section 3(b) for the remainder of such period. A "Change in
Control" will be deemed to have occurred if a person (as defined in Section
13(a) of the Securities Exchange Act of 1934 (the "Exchange Act")) who does not
beneficially own (as determined pursuant to Rule 13d-3 under the Exchange Act)
shares of the Company's capital stock entitled to vote generally in the election
of directors ("Equity Securities") immediately after the Effective Time (as
defined in the Merger Agreement) of the Merger becomes the beneficial owner of
Equity Securities with 51% of the voting power of all Equity Securities.
(e) Without Cause. The Company may terminate Employee's
employment without cause at any time. In such event, this Agreement shall
immediately terminate and Employee shall be entitled to receive (i) a severance
payment equal to the amount of his base salary that would have been receivable
for the period through the later of (A) the remainder of the term of this
Agreement under Section 4 or (B) one year from the date of termination, (ii) a
continuation of his benefits as specified in Section 3(b) for such period, and
(iii) any additional compensation due under Section 8.
(f) By Employee. Employee may resign from his employment with
the Company at any time. In such event, this Agreement shall terminate
immediately. Such resignation shall have the same effect under this Agreement as
a termination of this Agreement
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by the Company for cause, i.e., Employee's rights hereunder shall cease
immediately upon such termination; provided, however, Employee shall not lose
any stock options that have theretofore become vested as provided for in Section
3(c).
6. Confidential Information.
(a) Confidentiality. Employee acknowledges that the trade
secrets know-how and proprietary processes of the Company and its confidential
business plans, strategies, concepts, prospects and financial data
(collectively, "confidential information") are valuable, unique assets of the
Company. Employee shall not, during or after the term of this agreement,
disclose any of the confidential information (unless already generally known to
and available for use by the public other than as a result of Employee's acts or
omissions or as required by law) to any person or entity for any purpose, nor
shall Employee use any confidential information except, in either case, as is
required for Employee to perform his duties as an employee of the Company.
(b) Surrender or Destruction. Employee will, upon termination
of his employment with the Company, deliver to the Company all records, forms,
contracts, studies, reports, appraisals, financial data, lists of names or other
customer or supplier data, and any other articles or papers, computer tapes and
materials that have come into his possession by reason of his employment with
the Company, whether or not prepared by him, and he shall not retain memoranda
or copies of any of those items.
7. Covenants Not to Compete or Interfere.
(a) Scope. In view of the unique and valuable executive
services that Employee has been retained to render to the Company and Employee's
current and future knowledge of the customers, trade secrets and other
proprietary information relating to the business of the Company and its
customers and suppliers, Employee agrees that during the period he is an
employee of the Company and for three years after any termination of this
Agreement, he will not Compete Against the Company in the United States of
America.
(b) Definition. For purposes of this Section 7, "Compete
Against" means "directly or indirectly, be employed by or advise any entity that
competes against the business activities of the Company, including the uplinking
of television stations pursuant to compulsory licenses, the transmission of data
and audio signals by satellite for customers for resale as a carrier (common or
otherwise), the delivery of electronic program guides, pay per view guides and
interactive guides to cable television systems, the development of interactive
guides and any other material business the Company shall develop or engage in
during the term of this Agreement. If any restriction contained in this Section
7 is deemed to be invalid, illegal or unenforceable by reason of its duration,
geographical scope or otherwise, then such provision shall be deemed reduced in
extent, duration, geographical scope or otherwise by the minimum reduction
necessary to cause the restriction to be enforceable.
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(c) Noninterference. During the period he is an employee of the
Company and for three years after any termination of this Agreement, Employee
shall not (i) directly or indirectly cause or attempt to cause any employee of
the Company to leave the employ of the Company, (ii) in any way interfere with
the relationship between the Company and any employee, (iii) directly or
indirectly hire any employee of the Company to work for any organization of
which Employee is an officer, director, employee, consultant, independent
contractor or owner of an equity or other financial interest or (iv) interfere
or attempt to interfere with any transaction in which the Company was involved
during the term of this Agreement or his employment.
8. Certain Additional Severance. If this Agreement is terminated
under Section 5(e), the Company shall pay to Employee, on a semimonthly basis in
arrears, an amount equal to one-half of his then applicable base salary under
Section 3(a) until the earlier of (i) three years after termination of this
Agreement or (ii) the date on which he commences full-time employment or work as
a full-time consultant. Any payment of severance or benefits to Employee under
Section 5(e) with respect to any period shall satisfy and reduce the Company's
payment obligation under this Section 8 for that period. The right to payments
pursuant to this Section 8 shall cease immediately in the event of a breach by
Employee of any of his covenants made in Section 7.
9. Injunctive Relief. Upon an actual or threatened breach by
Employee of Section 6 or Section 7 of this Agreement, the Company shall be
entitled to an injunction restraining Employee from such breach. Nothing in this
Agreement shall limit the Company's ability to obtain any other remedies,
including damages for such actual or threatened breach.
10. Waiver of Breach. A waiver by the Company of a breach of any
provision of this Agreement by Employee shall not be construed as a waiver of
any breach of another provision or subsequent breach of the same provision.
11. Severability. The invalidity or unenforceability in any
application of any provision in this Agreement will not affect the validity or
enforceability of any other provision or of such provision in any other
application.
12. Notices. All communications, requests, consents and other
notices provided for in this Agreement shall be in writing and shall be deemed
given if and when delivered personally by hand, sent by telecopy at the
appropriate number indicated below with electronic confirmation of receipt, or
three business days after the same is deposited in the U.S. mails, first class
mail, postage prepaid, addressed as follows:
(i) If to the Company:
United Video Satellite Group, Inc.
0000 Xxxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000-0000
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Facsimile No.: (000) 000-0000
(ii) If to Employee:
Xx. Xxxxxxxx Xxxxx, Xx.
000 Xxxxx Xxxxxxxx Xxxxx
X.X. Xxx 000
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Facsimile No. (000) 000-0000
or to such other address or telecopy number as either party may designate by
notice pursuant to this Section 12.
13. Governing Law. This Agreement shall be governed by Oklahoma
laws.
14. Assignment. The Company may assign its rights and delegate its
obligations under this Agreement to any affiliate of the Company or to any
acquiror of substantially all of the business of the Company whether through
merger, purchase of assets, purchase of stock or otherwise. Otherwise, neither
party may assign any rights or delegate any duties under this Agreement. This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective legal representatives, heirs, and permitted successors and
assigns.
15. Entire Agreement. This Agreement sets forth the entire agreement
and understanding of the parties and supersedes all prior understandings,
agreements or representations by the parties, written or oral, that relates to
the subject matter of this Agreement.
16. Amendments. No provision of this Agreement may be amended or
waived except by an instrument in writing signed by the party sought to be
charged with the amendment or waiver.
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17. Effective Date. This Agreement shall be effective upon the
Closing of the Merger.
Executed as of the date set forth above.
UNITED VIDEO SATELLITE GROUP,
INC., a Delaware corporation
By:_________________________________
____________________________________
Xxxxxxxx Xxxxx, Xx.
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