EXHIBIT 10.1
EMPLOYMENT AGREEMENT
[XXXX XXXXX]
This Employment Agreement is entered into and effective as of the
Company's signature below (the "Effective Date") between Clear Channel Outdoor
Holdings, Inc., a Delaware corporation (the "Company") and Xxxx Xxxxx (the
"Employee").
WHEREAS, the Company and the Employee desire to enter into an
employment relationship under the terms and conditions set forth in this
Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. TERM OF EMPLOYMENT.
The Employee's current Term of employment starts on the Effective Date
and ends no earlier than the third anniversary of the Effective Date, unless
neither party has given the one year notice described in Section 7(c) or 7(d),
below. If such one year notice has not been given, the Term shall automatically
extend, beginning on the second anniversary of the Effective Date, one day at a
time, until such notice has been given.
2. TITLE AND DUTIES.
The Employee's title is President and Chief Operating Officer, Clear
Channel Outdoor. The Company may later choose to elevate this title and
responsibilities to Chief Executive Officer, at its sole discretion. Employee
understands and agrees that he will not receive any additional compensation in
the event of such change in title and responsibilities. The Employee will
perform job duties that are usual and customary for this position, and will
perform additional services and duties that the Company may from time to time
designate that are consistent with the usual and customary duties of this
position or of a Chief Executive Officer. The Employee will report to the
President and Chief Executive Officer, Clear Channel Communications, Inc.,
currently Xxxx Xxxx. The Employee will devote his full working time and efforts
to the business and affairs of Clear Channel Outdoor in its newly combined
domestic and international organizational form.
3. COMPENSATION AND BENEFITS
(a) BASE SALARY. The Company will pay the Employee an annual base
salary of $600,000 for the first year after the Effective Date; $625,000 for the
second year after the Effective Date; and $650,000 for the third year after the
Effective Date. The Employee will be eligible for additional annual raises
commensurate with Company policy. All payments of base salary will be made in
installments according to the Company's regular payroll practice, prorated
monthly or weekly where appropriate, and subject to any increases that are
determined to be appropriate by the Board of Directors of the Company ("Board")
and its Compensation Committee.
(b) PERFORMANCE BONUS. No later than March 31 of each calendar year
during the term, Employee will be eligible to receive a performance bonus as set
forth in the Performance Bonus Calculation attached as "Exhibit A" to this
Employment Agreement.
(c) EMPLOYMENT BENEFIT PLANS. The Employee will be entitled to
participate in: all pension, profit sharing, and other retirement plans; all
incentive compensation plans; and all group health, hospitalization and
disability or other insurance plans; paid vacation, sick leave and other
employee welfare benefit plans in which other similarly situated employees of
the Company may participate as stated in the employee guide.
(d) EXPENSES. The Company will pay or reimburse the Employee for all
normal and reasonable travel and entertainment expenses incurred by the Employee
in connection with the Employee's responsibilities to the Company upon
submission of proper vouchers in accordance with the Company's expense
reimbursement policy.
(e) STOCK OPTIONS. Any future stock option grants will be granted based
upon the performance of the Employee, which will be assessed in the sole
discretion of the Company and the Compensation Committee of the Board. All
option grants shall be made under the terms and conditions set forth in the
applicable Clear Channel Communications Stock Option Plan under which they are
issued. The Company reserves the right to modify any future Company incentive
compensation or stock option plan with respect to the change of control, the
granting of restricted stock or any other provision of such plans. The Company's
obligations under this agreement to the Employee in the area of stock options
are conditioned upon and subject to the Company's future decision, in its sole
discretion, to: 1) alter, suspend or discontinue its stock option grant program;
or 2) replace the program with an alternative form or method of compensation.
4. NONDISCLOSURE OF CONFIDENTIAL INFORMATION.
During the course of the Employee's employment with the Company, the
Company will provide the Employee with access to certain confidential
information, trade secrets, and other matters which are of a confidential or
proprietary nature, including but not limited to the Company's customer lists,
pricing information, production and cost data, compensation and fee information,
strategic business plans, budgets, financial statements, and other information
the Company treats as confidential or proprietary (collectively the
"Confidential Information"). The Company provides on an ongoing basis such
Confidential Information as the Company deems necessary or desirable to aid the
Employee in the performance of his duties. The Employee understands and
acknowledges that such Confidential Information is confidential and proprietary,
and agrees not to disclose such Confidential Information to anyone outside the
Company except to the extent that (i) the Employee deems such disclosure or use
reasonably necessary or appropriate in connection with performing his duties on
behalf of the Company; (ii) the Employee is required by order of a court of
competent jurisdiction (by subpoena or similar process) to disclose or discuss
any Confidential Information, provided that in such case, the Employee shall
promptly inform the Company of such event, shall cooperate with the Company in
attempting to obtain a protective order or to otherwise restrict such
disclosure, and shall only disclose Confidential Information to the minimum
extent necessary to comply with any such court order; or (iii) such Confidential
Information becomes generally known to and available for use in the industries
in which the Company does business, other than as a result of any action or
inaction by the Employee. The Employee further agrees that he will not during
employment and/or at any time thereafter use such Confidential Information in
competing, directly or
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indirectly, with the Company. At such time as the Employee shall cease to be
employed by the Company, he will immediately turn over to the Company all
Confidential Information, including papers, documents, writings, electronically
stored information, other property, and all copies of them, provided to or
created by him during the course of his employment with the Company. This
nondisclosure covenant is binding on the Employee, as well as his heirs,
successors, and legal representatives, and will survive the termination of this
Agreement for any reason.
5. NONHIRE OF COMPANY EMPLOYEES.
To further preserve the rights of the Company pursuant to the
nondisclosure covenant discussed above, and for the consideration promised by
the Company under this Agreement, during the term of the Employee's employment
with the Company and for a period of twelve months thereafter, regardless of the
reason for termination of employment, the Employee will not, directly or
indirectly, (i) hire any current or prospective employee of the Company, or any
subsidiary or affiliate of the Company (including, without limitation, any
current or prospective employee of the Company within the 6-month period
preceding the Employee's last day of employment with the Company or within the
12-month period of this covenant) who worked, works, or has been offered
employment by the Company; (ii) solicit or encourage any such employee to
terminate their employment with the Company, or any subsidiary or affiliate of
the Company; or (iii) solicit or encourage any such employee to accept
employment with any business, operation, corporation, partnership, association,
agency, or other person or entity with which the Employee may be associated. If,
during the term of this non-hire covenant, the Employee learns that any such
employee has accepted employment with any business, operation, corporation,
partnership, association, agency, or other person or entity with which the
Employee may be associated (other than the Company), the Employee will
immediately send notice to the Company identifying the employee and certifying
that the Employee did not breach any provision of this non-hire covenant.
6. NON-COMPETITION.
To further preserve the rights of the Company pursuant to the
nondisclosure covenant discussed above, and for the consideration promised by
the Company under this Agreement, during the Employee's employment with the
Company and for a period of one year thereafter, regardless of the reason for
termination of employment, the Employee will not, directly or indirectly, as an
owner, director, principal, agent, officer, employee, partner, consultant,
servant, or otherwise, carry on, operate, manage, control, or become involved in
any manner with any business, operation, corporation, partnership, association,
agency, or other person or entity which is in the same business as the Company
in any location in which the Company, or any subsidiary or affiliate of the
Company, operates or has plans or has projected to operate during the Employee's
employment with the Company, including any area within a 50-mile radius of any
such location. The foregoing shall not prohibit the Employee from owning up to
5.0% of the outstanding stock of any publicly held company. Notwithstanding the
foregoing, after the Employee's employment with the Company has terminated, upon
receiving written permission by the Board, the Employee shall be permitted to
engage in such competing activities that would otherwise be prohibited by this
covenant if such activities are determined in the sole discretion of the Board
in good faith to be immaterial to the operations of the Company, or any
subsidiary or affiliate of the Company, in the location in question.
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To further preserve the rights of the Company pursuant to the
nondisclosure covenant discussed above, and for the consideration promised by
the Company under this Agreement, during the term of the Employee's employment
with the Company and for a period of one year thereafter, regardless of the
reason for termination of employment, the Employee will not, directly or
indirectly, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity, call
upon, compete for, solicit, divert, or take away, or attempt to divert or take
away current or prospective customers (including, without limitation, any
customer with whom the Company, or any subsidiary or affiliate of the Company,
(i) has an existing agreement or business relationship; (ii) has had an
agreement or business relationship within the six-month period preceding the
Employee's last day of employment with the Company; or (iii) has included as a
prospect in its applicable pipeline) of the Company, or any subsidiary or
affiliate of the Company.
The Company and the Employee agree that the restrictions contained in
this noncompetition covenant are reasonable in scope and duration and are
necessary to protect the Company's business interests and Confidential
Information. If any provision of this noncompetition covenant as applied to any
party or to any circumstance is adjudged by a court or arbitrator to be invalid
or unenforceable, the same will in no way affect any other circumstance or the
validity or enforceability of this Agreement. If any such provision, or any part
thereof, is held to be unenforceable because of the scope, duration, or
geographic area covered thereby, the parties agree that the court or arbitrator
making such determination shall have the power to reduce the scope and/or
duration and/or geographic area of such provision, and/or to delete specific
words or phrases, and in its reduced form, such provision shall then be
enforceable and shall be enforced. The parties agree and acknowledge that the
breach of this noncompetition covenant will cause irreparable damage to the
Company, and upon breach of any provision of this noncompetition covenant, the
Company shall be entitled to injunctive relief, specific performance, or other
equitable relief; provided, however, that this shall in no way limit any other
remedies which the Company may have (including, without limitation, the right to
seek monetary damages).
Should the Employee violate the provisions of this noncompetition covenant, then
in addition to all other rights and remedies available to the Company at law or
in equity, the duration of this covenant shall automatically be extended for the
period of time from which the Employee began such violation until he permanently
ceases such violation
7. TERMINATION.
The Employee's employment with the Company may be terminated under the
following circumstances:
(a) DEATH. The Employee's employment with the Company shall terminate
upon his death.
(b) DISABILITY. The Company may terminate the Employee's employment
with the Company if, as a result of the Employee's incapacity due to physical or
mental illness, the Employee is unable to perform his duties under this
Agreement on a full-time basis for more than 90 days in any 12 month period, as
determined by the Company.
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(c) TERMINATION BY THE COMPANY. The Company may terminate the
Employee's employment with the Company for any reason at any time after the
second anniversary of the Effective Date upon one year's written notice, and, in
no case to be effective earlier than the third anniversary of the Effective
Date. The Company may also terminate the Employee's employment for Cause. A
termination for Cause must be for one or more of the following reasons: (i)
conduct by the Employee constituting a material act of willful misconduct in
connection with the performance of his duties, including, without limitation,
violation of the Company's policy on sexual harassment, misappropriation of
funds or property of the Company or any of its affiliates other than the
occasional, customary and de minimis use of Company property for personal
purposes, or other willful misconduct as determined in the sole discretion of
the Company; (ii) continued, willful and deliberate non-performance by the
Employee of his duties hereunder (other than by reason of the Employee's
physical or mental illness, incapacity or disability) where such non-performance
has continued for more than 10 days following written notice of such
non-performance; (iii) the Employee's refusal or failure to follow lawful
directives where such refusal or failure has continued for more than 30 days
following written notice of such refusal or failure; (iv) a criminal or civil
conviction of the Employee, a plea of nolo contendere by the Employee, or other
conduct by the Employee that, as determined in the sole discretion of the Board,
has resulted in, or would result in if he were retained in his position with the
Company, material injury to the reputation of the Company, including, without
limitation, conviction of fraud, theft, embezzlement, or a crime involving moral
turpitude; (v) a breach by the Employee of any of the provisions of this
Agreement; or (vi) a violation by the Employee of the Company's employment
policies.
(d) TERMINATION BY THE EMPLOYEE. The Employee may terminate his
employment with the Company at any time after the second anniversary of the
Effective Date with a one year written notice to Company, and, in no case to be
effective earlier than the third anniversary of the Effective Date.
8. COMPENSATION UPON TERMINATION.
(a) DEATH. If the Employee's employment with the Company terminates by
reason of his death, the Company will, within 90 days, pay in a lump sum amount
to such person as the Employee shall designate in a notice filed with the
Company or, if no such person is designated, to the Employee's estate, the
Employee's accrued and unpaid base salary and prorated bonus, if any (See
Exhibit A), and any payments to which the Employee's spouse, beneficiaries, or
estate may be entitled under any applicable employee benefit plan (according to
the terms of such plans and policies).
(b) DISABILITY. If the Employee's employment with the Company
terminates by reason of his disability, the Company shall, within 90 days, pay
in a lump sum amount to the Employee his accrued and unpaid base salary and
prorated bonus, if any (See Exhibit A), and any payments to which he may be
entitled under any applicable employee benefit plan (according to the terms of
such plans and policies).
(c) TERMINATION BY THE COMPANY FOR CAUSE. If the Employee's employment
with the Company is terminated by the Company for Cause the Company will, within
90 days, pay in a lump sum amount to the Employee his accrued and unpaid base
salary and any payments to which he may be entitled under any applicable
employee benefit plan (according to the terms of such plans and policies).
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(d) TERMINATION BY THE COMPANY WITHOUT CAUSE. If the Employee's
employment with the Company is terminated by the Company without Cause, the
Company will, within 90 days after the effective date of the termination, pay in
a lump sum amount to the Employee his accrued and unpaid base salary and
prorated bonus, if any (See Exhibit A), and any payments to which he may be
entitled under any applicable employee benefit plan (according to the terms of
such plans and policies). Additionally, Employee will receive a total of
$600,000, paid pro rata over a one year period in accordance with the Company's
standard payroll schedule and practices, as consideration for Employee's
post-termination non-compete and non-solicitation obligations under Paragraphs
Five and Six, above.
(e) EFFECT OF COMPLIANCE WITH COMPENSATION UPON TERMINATION PROVISIONS.
Upon complying with Subparagraphs 8(a) through 8(d) above, as applicable, the
Company will have no further obligations to the Employee except as otherwise
expressly provided under this Agreement, provided that such compliance will not
adversely affect or alter the Employee's rights under any employee benefit plan
of the Company in which the Employee has a vested interest, unless, otherwise
provided in such employee benefit plan or any agreement or other instrument
attendant thereto.
9. PARTIES BENEFITED; ASSIGNMENTS.
This Agreement shall be binding upon the Employee, his heirs and his
personal representative or representatives, and upon the Company and its
respective successors and assigns. Neither this Agreement nor any rights or
obligations hereunder may be assigned by the Employee, other than by will or by
the laws of descent and distribution.
10. NOTICES.
Any notice provided for in this Agreement will be in writing and will be deemed
to have been given when delivered or mailed by United States registered or
certified mail, return receipt requested, postage prepaid. If to the Board or
the Company, the notice will be sent to Xxxx X. Xxxx, President and Chief
Executive Officer, Clear Channel Communications, Inc., 000 X. Xxxxx Xxxx, Xxx
Xxxxxxx, XX 00000 and a copy of the notice will be sent to Xxxxxx X. Xxxxx, EVP
and CLO, Clear Channel Communications, Inc., 000 X. Xxxxx Xxxx, Xxx Xxxxxxx, XX
00000 . If to the Employee, the notice will be sent to 0000 X. 00xx Xxxxx,
Xxxxxxx, XX 00000. Such notices may alternatively be sent to such other address
as any party may have furnished to the other in writing in accordance with this
Agreement, except that notices of change of address shall be effective only upon
receipt.
11. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with
the internal laws of the State of Texas without giving effect to any choice of
law or conflict provisions or rule (whether of the State of Texas or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the State of Texas and the Employee hereby expressly consents to the
personal jurisdiction of the state and federal courts located in the State of
Texas for any lawsuit arising from or relating to this Agreement.
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12. DEFINITION OF COMPANY.
As used in this Agreement, the term "Company" shall include any of its
past, present and future divisions, operating companies, subsidiaries and
affiliates.
13. LITIGATION AND REGULATORY COOPERATION.
During and after the Employee's employment, the Employee shall
reasonably cooperate with the Company in the defense or prosecution of any
claims or actions now in existence or which may be brought in the future against
or on behalf of the Company which relate to events or occurrences that
transpired while the Employee was employed by the Company; provided, however,
that such cooperation shall not materially and adversely affect the Employee or
expose the Employee to an increased probability of civil or criminal litigation.
The Employee's cooperation in connection with such claims or actions shall
include, but not be limited to, being available to meet with counsel to prepare
for discovery or trial and to act as a witness on behalf of the Company at
mutually convenient times. During and after the Employee's employment, the
Employee also shall cooperate fully with the Company in connection with any
investigation or review of any federal, state or local regulatory authority as
any such investigation or review relates to events or occurrences that
transpired while the Employee was employed by the Company. The Company will pay
the Employee on an hourly basis (to be derived from his base salary) for
requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse the Employee for all costs and expenses
incurred in connection with his performance under this paragraph, including, but
not limited to, reasonable attorneys' fees and costs.
14. INDEMNIFICATION AND INSURANCE; LEGAL EXPENSES.
The Company shall indemnify the Employee to the fullest extent
permitted by law, in effect at the time of the subject act or omission, and
shall advance to the Employee reasonable attorneys' fees and expenses as such
fees and expenses are incurred (subject to an undertaking from the Employee to
repay such advances if it shall be finally determined by a judicial decision
which is not subject to further appeal that the Employee was not entitled to the
reimbursement of such fees and expenses), and the Employee will be entitled to
the protection of any insurance policies that the Company may elect to maintain
generally for the benefit of its directors and officers against all costs,
charges and expenses incurred or sustained by him in connection with any action,
suit or proceeding to which he may be made a party by reason of his being or
having been a director, officer or employee of the Company or any of its
subsidiaries, or his serving or having served any other enterprise as a
director, officer or employee at the request of the Company (other than any
dispute, claim or controversy arising under or relating to this Agreement). The
Company covenants to maintain during the Employee's employment for the benefit
of the Employee (in his capacity as an officer and director of the Company)
Directors and Officers Insurance providing benefits to the Employee no less
favorable, taken as a whole, than the benefits provided to the other similarly
situated employees of the Company by the Directors and Officers Insurance
maintained by the Company on the date hereof; provided, however, that the Board
may elect to terminate Directors and Officers Insurance for all officers and
directors, including the Employee, if the Board determines in good faith that
such insurance is not available or is available only at unreasonable expense.
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15. ARBITRATION.
The parties agree that any dispute, controversy or claim, whether based on
contract, tort, statute, discrimination, retaliation, or otherwise, relating to,
arising from or connected in any manner to this Agreement, or to the alleged
breach of this Agreement, or arising out of or relating to Employee's employment
or termination of employment, shall, upon timely written request of either party
be submitted to and resolved by binding arbitration. The arbitration shall be
conducted in San Antonio, Texas. The arbitration shall proceed in accordance
with the National Rules for Resolution of Employment Disputes of the American
Arbitration Association ("AAA") in effect at the time the claim or dispute
arose, unless other rules are agreed upon by the parties. Unless otherwise
agreed to by the parties in writing, the arbitration shall be conducted by one
arbitrator who is a member of the AAA and who is selected pursuant to the
methods set out in the National Rules for Resolution of Employment Disputes of
the AAA. Any claims received after the applicable/relevant statute of
limitations period has passed shall be deemed null and void. The award of the
arbitrator shall be a reasoned award with findings of fact and conclusions of
law. Either party may bring an action in any court of competent jurisdiction to
compel arbitration under this Agreement, to enforce an arbitration award, and to
vacate an arbitration award. However, in actions seeking to vacate an award, the
standard of review to be applied by said court to the arbitrator's findings of
fact and conclusions of law will be the same as that applied by an appellate
court reviewing a decision of a trial court sitting without a jury. The Company
will pay the actual costs of arbitration excluding attorney's fees. Each party
will pay its own attorneys fees and other costs incurred by their respective
attorneys.
16. REPRESENTATIONS AND WARRANTIES OF THE EMPLOYEE.
The Employee represents and warrants to the Company that he is under no
contractual or other restriction which is inconsistent with the execution of
this Agreement, the performance of his duties hereunder or the other rights of
Company hereunder. The Employee also represents and warrants to the Company that
he is under no physical or mental disability that would hinder the performance
of his duties under this Agreement.
17. MISCELLANEOUS.
This Agreement contains the entire agreement of the parties relating to
the subject matter hereof. This Agreement supersedes any prior written or oral
agreements or understandings between the parties relating to the subject matter
hereof. No modification or amendment of this Agreement shall be valid unless in
writing and signed by or on behalf of the parties hereto. The failure of a party
to require performance of any provision of this Agreement shall in no manner
affect the right of such party at a later time to enforce any provision of this
Agreement. A waiver of the breach of any term or condition of this Agreement
shall not be deemed to constitute a waiver of any subsequent breach of the same
or any other term or condition. This Agreement is intended to be performed in
accordance with, and only to the extent permitted by, all applicable laws,
ordinances, rules and regulations. If any provision of this Agreement, or the
application thereof to any person or circumstance, shall, for any reason and to
any extent, be held invalid or unenforceable, such invalidity and
unenforceability shall not affect the remaining provisions hereof or the
application of such provisions to other persons or circumstances, all of which
shall be enforced to the greatest extent permitted by law. The headings in this
Agreement are inserted
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for convenience of reference only and shall not be a part of or control or
affect the meaning of any provision hereof.
IN WITNESS WHEREOF, the parties have duly executed and delivered this
Agreement as of the date last executed below.
DATE: August 5, 2005 XXXX XXXXX
/s/ Xxxx Xxxxx
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CLEAR CHANNEL OUTDOOR HOLDINGS, INC.
DATE: August 5, 2005 By: /s/ Xxxx X. Xxxx
------------------------------
Name: Xxxx X. Xxxx
Title: Chief Executive Officer
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EXHIBIT A
PERFORMANCE BONUS CALCUATION
To be determined at the sole discretion of the Board and the Compensation
Committee.
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