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EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made and entered into as
of the 28th day of September, 1996 by and between SPANISH BROADCASTING SYSTEM,
INC., a Delaware corporation with its principal office located at 00 Xxxx 00xx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Company"), and XXXXXXX X. OASIS (the
"Executive"), whose address is 0000 X.X. 00xx Xxxxxx, Xxxxx, Xxxxxxx 00000.
Recitals
A. Executive is the Chief Executive Officer and 50% shareholder of New Age
Broadcasting, Inc. and The Seventies Broadcasting Corporation (collectively,
"The Selling Companies"). The Selling Companies own and operate WXDJ-FM,
Homestead, Florida and WRMA-FM, Ft. Lauderdale, Florida (collectively, the
"Stations"). The Selling Companies have entered into an asset purchase agreement
dated as of September 16, 1996 to sell the Stations to the Company ("Asset
Purchase Agreement").
B. The Asset Purchase Agreement requires the Company to enter into an
employment agreement with the Executive as provided in the Asset Purchase
Agreement.
C. The Executive, subject to his duties and obligations as Chief Executive
Officer ("CEO") and principal shareholder of the Selling Companies, which duties
and obligations supersede duties and obligations of Executive hereunder, wishes
to commence his employment with the Company prior to the closing of the Asset
Purchase Agreement.
D. The Board of Directors of the Company (the "Board") believes that the
Executive can contribute to the growth and success of the Company, and desires
to assure the Company of the Executive's employment and to compensate him
therefor.
E. The Board has determined that this Agreement will encourage the
Executive's attention and dedication to the Company.
F. The Executive is willing to make his services available to the Company
on the terms and conditions hereinafter set forth.
Agreement
NOW, THEREFORE, in consideration of the premises and mutual covenants set
forth herein, the parties agree as follows:
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1. Employment.
1.1 General. Subject to the termination provisions of this
Agreement, the Company hereby agrees to employ the Executive, and the Executive
hereby agrees to serve the Company on the terms and conditions set forth herein.
1.2 Duties of the Executive. During the term of this Agreement, the
Executive shall serve as the Executive Vice President of Programming for Company
and Chief Operating Officer of Stations and WCMQ-FM, shall diligently perform
all duties as may be assigned to him by Xxxx Xxxxxxx, Xx., the Company's Chief
Executive Officer, consistent with his position, and shall exercise such power
and authority, consistent with his position, as may from time to time be
delegated to him by Xxxx Xxxxxxx, Xx. Subsequent to the closing of the Asset
Purchase Agreement, the Executive shall devote substantially all of his business
time and attention to the business and affairs of the Company, render such
services to the best of his ability, and use his best efforts to promote the
interests of the Company; provided, however, that the Executive may be involved,
as an investor, officer, director or otherwise (as long as the Executive is not
actively employed in such business) in any business that is not primarily
engaged in Spanish radio broadcasting. Prior to the closing of the Asset
Purchase Agreement, the Company agrees that Executive's responsibility shall be
to the Stations and any duties or obligations of Executive under this Agreement
shall be subordinate to his duties and obligations to the Stations and the
Selling Companies as its CEO and principal shareholder. Subject to the direction
of Xxxx Xxxxxxx, Xx., the Chief Executive Officer, the Executive shall be
responsible for the day-to-day operations of the Company's radio stations
(including those directly or indirectly controlled by the Company).
2. Term. This Agreement shall be for a term of one (1) year, commencing on
the date hereof and ending on September 25, 1997, unless sooner terminated as
hereinafter set forth (the "Term"). The Term may be extended by mutual written
agreement of the parties within 60 days prior to the expiration of the Term.
Without in any way committing or otherwise legally obligating the Company or the
Executive, the parties understand that in order for the Executive to extend the
term of this Agreement, the Executive must be offered a compensation package,
including an equity participation in the Company, satisfactory to the Executive.
3. Compensation.
3.1 Base Salary. The Executive shall receive a base salary at the
annual rate of Four Hundred Fifty Thousand Dollars ($450,000) (the "Base
Salary") during the Term of this Agreement, with such Base Salary payable in
installments consistent with the Company's normal payroll schedule, subject to
applicable withholding and other taxes.
3.2 Bonus. The Executive shall receive a bonus (the "Bonus") in the
amounts, and in accordance with the terms and conditions, set forth in Schedule
A hereto.
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4. Expense Reimbursement and Other Benefits.
4.1 Other Reimbursable Expenses. During the term of the Executive's
employment hereunder, the Company, shall reimburse the Executive for all
reasonable expenses actually and necessarily paid or incurred by the Executive
in the course of and pursuant to the business of the Company. The Executive
shall comply with the Company's policy for reimbursement of expenses for its
senior executives.
4.2 Other Benefits. The Executive and his immediate family shall be
entitled to participate in all medical and hospitalization, group life
insurance, and any and all other plans as are presently and hereinafter provided
by the Company to any of its executives. The Executive shall also be entitled to
four (4) weeks paid vacation time, as well as paid time off for holidays and
sick leave in accordance with the Company's prevailing policy for any of its
senior executives generally.
4.3 Working Facilities. The Company shall furnish the Executive with
an office, secretarial help and such other facilities and services suitable to
his position and adequate for the performance of his duties hereunder.
4.4 Automobile Allowance. The Executive shall be entitled to an
automobile allowance of $500 per month, which amount is intended to compensate
Executive for wear and tear and, in addition, reimburse the Executive for all
costs of gasoline, oil, repairs, maintenance, insurance and other expenses
incurred by the Executive by reason of the use of the Executive's automobile for
Company business from time to time.
4.5 Place of Employment. In connection with his employment by the
Company, the Executive shall be based at the Company's offices located in Dade
County, Florida except for travel on the Company's business deemed necessary by
the Executive from time to time.
4.6 Indemnification. The Company agrees to indemnify, defend and
make whole Executive for any action or inaction of Executive in pursuit of his
obligations under this Agreement on behalf of the Company, its subsidiaries and
affiliates to the fullest extent permitted by the corporate laws of the State of
Delaware, including the monthly payment of legal fees and costs necessary in any
defense. This right of indemnification shall not include nor cover any action by
the Executive that exceeds the scope of his authority under this Agreement. This
right of indemnification is subject to the obligation of Executive to reimburse
the Company if it is ultimately and judicially determined that the Executive is
not entitled to indemnification under Delaware corporate law.
5. Termination.
5.1 Termination for Cause. The Company shall at all times have the
right, upon written notice to the Executive, to terminate the Executive's
employment hereunder for "Cause" (as hereinafter defined). For purpose of this
Agreement, the term "Cause" shall mean (i) the willful failure or refusal of the
Executive to perform the duties or render the services
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reasonably assigned to him from time to time by the Board (except during
vacation periods or sick leave), which failure or refusal to perform is not
cured by the Executive within thirty (30) days of receipt of written notice from
the Company (ii) the conviction of the Executive of a felony or (iii) the
willful violation of the provisions of Section 6 hereof relating to
non-competition and non-disclosure, which violation is not cured within thirty
(30) days or receipt of notice from the Company. Any written notice delivered to
the Executive pursuant to this Section 5.1 shall set forth in reasonable detail
the acts or omissions of the Executive that constitute grounds for termination
for "Cause" and the actions required by the Executive to adequately cure any
such default.
5.2 Disability. The Company shall at all times have the right, upon
written notice to the Executive, to terminate the Executive's employment
hereunder if the Executive shall, as the result of mental or physical
incapacity, illness or disability, become unable to perform his hereunder for in
excess of ninety (90) days in any 12-month period. Upon any termination pursuant
to this Section 5.2, the Company shall pay to the Executive any unpaid amounts
of his Base Salary accrued through the effective date of termination and the
amount, if any, of the unpaid Bonus to which the Executive would have been
entitled at the expiration of the Term in accordance with Section 3.2 hereof,
and an amount to be determined by the Board of Directors in their sole and
absolute discretion, and the Company shall have no further liability hereunder
(other than for reimbursement for reasonable business expenses incurred prior to
the date of termination, subject, however to the provisions of Section 4.1).
5.3 Death. In the event of the death of the Executive during the
term of his employment hereunder, the Company shall pay to the estate of the
deceased Executive any unpaid amounts of his Base Salary accrued through the
effective date of his death and the amount, if any, of the unpaid Bonus to which
the Executive would have been entitled at the expiration of the Term in
accordance with Section 3.2 hereof, and the Company shall have no further
liability hereunder (other than for reimbursement for reasonable business
expenses incurred prior to the date of the Executive's death, subject, however
to the provisions of Section 4.1).
5.4 Resignation by the Executive. The Executive shall at all times
have the right, upon 30 days' written notice to the Company, to terminate the
Executive's employment hereunder. Upon any termination pursuant to this Section
5.4, the Employee shall be entitled to be paid his Base Salary to the date of
termination, and the Company shall have no further liability hereunder (other
than for reimbursement of reasonable business expenses incurred prior to the
date of termination, subject, however, to the provisions of Section 4.1).
5.5 COBRA Benefits. Upon any termination of the employment of the
Executive, including any termination as a result of the expiration of the term
of this Agreement, the Executive shall be entitled to COBRA benefits for a
period of 18 months.
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6. Restrictive Covenants.
6.1 Non-competition. While employed by the Company and subsequent to
the closing of the Asset Purchase Agreement, the Executive shall not, directly
or indirectly, own, operate, manage, be employed by, consult or provide any
services to any radio broadcast station that broadcasts in the Spanish language
whose main studio or transmitter is located within a fifty (50) mile radius of
any radio station owned, under contract to purchase or operated by the Company
or any of the Company's subsidiaries or affiliates during the term of this
Agreement.
6.2 Nondisclosure. While employed by the Company and subsequent to
the closing of the Asset Purchase Agreement, the Executive shall not divulge,
communicate, use to the detriment of the Company or any affiliate or for the
benefit of any other person or persons, or misuse in any way, any confidential
information pertaining to the business of the Company or any of the Company's
subsidiaries or affiliates. While employed by the Company and subsequent to the
closing of the Asset Purchase Agreement, any confidential information or data
now known or hereafter acquired by the Executive with respect to the business of
the Company or any affiliate (which shall include, but not be limited to,
information concerning the Company's or any affiliates' financial condition,
prospects, sources, and methods of doing business) shall be deemed a valuable,
special and unique asset of the Company that is received by the Executive in
confidence and as a fiduciary, and the Executive shall remain a fiduciary to the
Company with respect to all such information while employed by the Company.
6.3 Nonsolicitation of Employees and Customers. While employed by
the Company, the Executive shall not, directly or indirectly, hire any employee
of the Company or otherwise solicit or induce any employee of the Company to
terminate such employment or become employed by any person or entity other than
the Company or any of its affiliates.
6.4 Books and Records. All books, records and accounts relating in
any manner to the customers or clients of the Company, whether prepared by the
Executive or otherwise coming into the Executive's possession, shall be the
exclusive property of the Company and shall be returned immediately to the
Company on termination of the Executive's employment hereunder or on the
Company's request at any time.
7. Injunction. It is recognized and hereby acknowledged by the parties
hereto that a breach by the Executive of any or the covenants contained in
Section 6 of this Agreement will cause irreparable harm and damage to the
Company, the monetary amount of which may be virtually impossible to ascertain.
As a result, the Executive recognizes and hereby acknowledges that the Company
shall be entitled to an injunction from any court of competent jurisdiction
enjoining or restraining any violation of any or all of the covenants contained
in Section 6 of this Agreement by the Executive or any of his affiliates,
associates, partners or agents, either directly or indirectly, and that such
right to injunction shall be cumulative and in addition to whatever remedies the
Company may possess.
8. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida without regard to any conflict
of law, rule or principle that would give effect to the laws of another
jurisdiction.
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9. Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and, upon
its effectiveness, shall supersede all prior agreements, understandings and
arrangements, both oral and written, between the Executive and the Company with
respect to such subject matter. This Agreement may not be modified in any way
unless by a written instrument signed by both the Company and the Executive.
10. Notices. Any notice required or permitted to be given hereunder shall
be deemed given when delivered by hand (including Federal Express) or when
deposited in the United States mail, by registered or certified mail, return
receipt requested, postage prepaid, to the parties hereto at their respective
address first stated herein, or to such other address as either party hereto may
from time to time give notice of to the other.
11. Benefits; Binding Effect. This Agreement shall be for the benefit of
and binding upon the parties hereto and their respective heirs, personal
representative, legal representatives, successors and, where applicable,
assigns, including, without limitation, any successor to the Company, whether by
merger, consolidation, sale of stock, sale of assets or otherwise; provided,
however that the Executive shall not delegate his employment obligations
hereunder, or any portion thereof, to any other person.
12. Severability. The invalidity of any one or more of the words, phrases,
sentences, clauses or sections contained in this Agreement shall not affect the
enforceability of the remaining portions of this Agreement or any part thereof,
all of which are inserted conditionally on their being valid in law, and, in the
event that any one or more of the words, phrases, sentences, clauses or sections
contained in this Agreement shall be declared invalid, this Agreement shall be
construed as if such invalid word or words, phrase or phrases, sentence or
sentences, clause or clauses, or section or sections had not been inserted. If
such invalidity is caused by length of time or size of area, or both, the
otherwise invalid provision will be considered to be reduced to a period or area
which would cure such invalidity.
13. Waivers. The waiver by either party hereto of a breach or violation of
any term or provision of this Agreement shall not operate nor be construed as a
waiver of any subsequent breach or violation.
14. Damages. Nothing contained herein shall be construed to prevent the
Company or the Executive from seeking and recovering from the other damages
sustained by either or both of them as a result of its or his breach of any term
or provision of this Agreement. In the event that either party hereto brings
suit for the collection of any damages resulting from, or for the injunction of
any action constituting, a breach of any of the terms or provisions of this
Agreement, then the party found to be at fault shall pay all reasonable court
costs and attorneys' fees of the other. Notwithstanding anything in this
Agreement to the contrary, the Executive shall have no duty to mitigate his
damages upon termination of this Agreement for any reason whatsoever.
15. Section Headings. The section headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this
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Agreement.
16. No Third Party Beneficiary. Nothing expressed or implied in this
Agreement is intended, or shall be construed, to confer upon or give any person
other than the Company, the Executive and their respective heirs, personal
representatives, legal representatives, successors and assigns, as applicable,
any rights or remedies under or by reason of this Agreement.
17. Right of Termination. Either the Company or the Executive may at any
time for any reason or for no reason prior to the closing of the Asset Purchase
Agreement give the other party 1 business day prior written notice and terminate
this Agreement without any further obligation of the Executive to the Company or
the Company to the Executive as a result of this Agreement other than the
reimbursement of expenses and the payment of compensation to the date of
termination.
18. No Liability. Notwithstanding anything to the contrary contained in
this Agreement, under no set of circumstances shall Executive be liable to
anyone because of any action or inaction of Executive prior to the closing of
the Asset Purchase Agreement is alleged to favor or benefit, or in fact favors
or benefits, the Stations or the Selling Companies to the detriment of the
Company, its subsidiaries or affiliates.
19. No Effect on the rights and obligations of the parties under the Asset
Purchase Agreement. The rights and obligations of the parties to the Asset
Purchase Agreement shall not be affected, amended or changed in any manner by
the performance or non-performance, or the termination, of this Agreement by any
of the parties prior, or subsequent to, the closing of the Asset Purchase
Agreement. The breach or termination of this Agreement prior to the closing of
the Asset Purchase Agreement will not relieve the Company of its obligation to
offer the employment agreement required by the Asset Purchase Agreement (the
"Required Asset Purchase Agreement"). If this Agreement is in effect subsequent
to the closing of the Asset Purchase Agreement, this Agreement shall be deemed
to be the Required Employment Agreement for all purposed under the Asset
Purchase Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first above written.
SPANISH BROADCASTING SYSTEM, INC.
By: /s/ Xxxx Xxxxxxx, Xx.
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
/s/ Xxxxxxx X. Oasis
-----------------------------------------
XXXXXXX X. OASIS
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Schedule A
BONUS
Executive shall be entitled to a cash bonus, payable within 45 days
after the end of the term of this Agreement, based on the percentage increase of
Broadcast Cash Flow for the full 12 calendar months following the effective date
of the Agreement, from the Base Cash Flow. Base Cash Flow shall be determined by
adding the following broadcast cash flow amounts: (i) for stations owned by the
Company or its subsidiaries for over one (1) year, the actual broadcast cash
flow for such stations for the twelve (12) full calendar months prior to the
effective date of this Agreement; (ii) for stations owned by the Company or its
subsidiaries for less than one (1) year but greater than six (6) months, the
actual broadcast cash flow for the previous three (3) full calendar months for
those stations multiplied by four (4); and (iii) for stations owned by the
Company or its subsidiaries for less than six months, an amount equal to 4-1/2%
of the purchase price for such stations. In the event any stations of the
Company or its subsidiaries are disposed of or acquired during the term of this
Agreement, the Company and the Executive shall in good faith determine a fair
adjustment to the Base Cash Flow as a result of any such acquisitions or
dispositions. Broadcast cash flow for purposes of this Bonus shall be determined
in the same manner as broadcast cash flow is determined for the latest public
filing of the Company with the Securities and Exchange Commission prior to the
effective date of this Agreement. The Bonus shall be as follows:
Percentage increase Cash Bonus
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0-9% increase in Broadcast Cash Flow
over Base Cash Flow............................. No Bonus
10-14%................................................ $ 100,000
15-19%................................................ $ 300,000
20-24%................................................ $ 550,000
25-29%................................................ $ 750,000
30-34%................................................ $1,000,000
35-39%................................................ $1,250,000
40-44%................................................ $1,500,000
45-50%................................................ $1,750,000
51-55%................................................ $2,000,000
For each 5% increase after 56%, the Bonus will be increased by $250,000 from the
previous cash bonus amount.
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